{"data":{"id":"us-ky/krs-386.466","jurisdiction":"us-ky","citation":"KRS 386.466","heading":"\"Entity\" defined -- Character of receipts from entities.","body":"(1) In this section, \"entity\" means a corporation, partnership, limited partnership,\nlimited liability company, statutory or business trust, regulated investment\ncompany, real estate investment trust, common trust fund, or any other organization\nin which a tru stee has an interest other than a trust or estate to which KRS 386.468\napplies.\n(2) Except as otherwise provided in this section, a trustee shall allocate to income\nmoney received from an entity.\n(3) A trustee shall allocate the following receipts from an entity to principal:\n(a) Property other than money;\n(b) Money received in one (1) distribution or a series of related distributions in\nexchange for part or all of a trust's interest in the entity;\n(c) Money received in total or partial liquidation of the entity; and\n(d) Money received from an entity that is a regulated investment company or a\nreal estate investment trust, if the money distributed is a capital gain dividend\nfor federal income tax purposes.\n(4) Money is received in partial liquidation:\n(a) To the extent that the entity, at or near the time of a distribution, indicates that\nit is a distribution in partial liquidation; or\n(b) If the total amount of money and property received in a distribution or series\nof related distributions is greater than t wenty percent (20%) of the entity's\ngross assets, as shown by the entity's year end financial statements\nimmediately preceding the initial receipt.\n(5) Money is not received in partial liquidation, nor may it be taken into account under\nparagraph (b) of su bsection (4) of this section to the extent that it does not exceed\nthe amount of income tax that a trustee or beneficiary shall pay on taxable income\nof the entity that distributes the money.\n(6) A trustee may rely upon a statement made by an entity about the source or character\nof a distribution if the statement is made at or near the time of distribution by the\nentity's board of directors or other person or group of persons authorized to exercise\npowers to pay money or transfer property comparable to thos e of a corporation's\nboard of directors.","path":["KRS Chapter 386"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=35925","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:59:16Z","sha256":"2905570fa2c6557b30b74121037925850ac2512ae2593ca8ce6306b6d6063da5","source_id":"us-ky","stale":false,"prev":"us-ky/krs-386.464","next":"us-ky/krs-386.468"},"notice":"GroundRules: Original legal text. Not legal advice."}