KRS 140.275: Exclusion of intangible personal property held in trust, under reciprocal

agreements with other states.

(1) It is hereby declared to be the legislative policy that Kentucky shall not be a party to

interstate double taxation under the terms of the Kentucky inheritance and estate tax

laws. Pursuant to this policy, the commissioner of the Department of Revenue is

hereby authorized to omit from the property subject to tax under those laws, any

intangible personal property of a nonresident decedent (having a domicile in the

United States) held in trust by a Kentucky trustee if the jurisdiction (state, territory

or District of Columbia) in which the decedent was domiciled grants similar

immunity to residents of Kentucky, but only in the event the personal representative

shall present evidence that the tax has been or will be paid to the other jurisdiction.

If another state, territory, or the District of Columbia of the United States

constitutionally imposes a tax on the transfer of estates or of the distributi ve shares

thereof, but grants immunity from the tax in respect of any intangible property of its

resident decedents held in trust by a Kentucky trustee, then the commissioner of the

Department of Revenue is hereby authorized to exclude from the property subject to

tax under the Kentucky inheritance and estate tax laws, the intangible personal

property of a Kentucky resident held in trust in that jurisdiction but only in the event

the personal representative shall present evidence that the tax has been or wi ll be

paid to the other jurisdiction.

(2) It is expressly provided, however, in view of the uncertainty now prevailing with

respect to the correct interpretation of the Constitution of the United States

regarding the jurisdiction of the several states, tha t the provisions of this section

shall be inoperative under the second alternative until and unless an agreement,

approved as to legality by the Attorney General, between the commissioner of the

Department of Revenue as agent for Kentucky and the appropria te administrative

official of such other state, shall have been executed and an original copy thereof

filed with the Kentucky Department of Revenue.

(3) This section is intended to apply retroactively to all estates of decedents on or after

April 25, 1936, which are subject to Kentucky inheritance tax laws.