Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-3-25 - ESTATES AND TRUSTS › Section 810-3-25-.06 - Trusts Exempt From Taxation, For Taxable Years Beginning Prior To January 1, 2005

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Except as
			 provided in paragraphs (2), (3) and (4) below, the following trusts are exempt
			 from taxation under §
								40-18-25,
Code of Ala. 1975
:
(a) Any qualified trust defined in  26 U.S.C. §
										401(a)  relating to qualified pension, profit sharing, or stock bonus
			 plans.
(b) A custodial account, an
			 annuity contract, or a contract issued by an insurance company that qualifies
			 under  26 U.S.C. §
										401(f).
(c)
			 An individual retirement account, an individual retirement annuity, or any
			 custodial account that qualifies under  26 U.S.C. §
										408(e),  26 U.S.C. §
										408A, or  26 U.S.C. §
										530.
(d) A retirement bond that qualifies under  26 U.S.C. §
										409.
(e) Corporations,
			 as described in  26 U.S.C. §
										501(c)(2), organized for the exclusive purpose
			 of holding title to property, collecting income therefrom, and remitting the
			 proceeds, less expenses, to an organization which is exempt under §
									40-18-25.
(f) Voluntary employees' beneficiary
			 associations as described in  26 U.S.C. §
										501(c)(9).
(g) Local teachers' retirement fund
			 associations as described in  26 U.S.C. §
										501(c)(11).
(h) A trust or trusts forming part of a plan
			 providing for the payment of supplemental unemployment compensation benefits as
			 described in  26 U.S.C. §
										501(c)(17).
(i) An organization or trust created
			 exclusively to form part of a qualified group legal services plan or plans, as
			 described in  26 U.S.C. §
										501(c)(20).
(j) A trust created exclusively to pay
			 liability insurance premiums for, pay administrative and other expenses of, and
			 pay claims for liability for disability or death due to pneumoconiosis (black
			 lung), as described in  26 U.S.C. §
										501(c)(21).
(k) A charitable remainder annuity trust or a
			 charitable remainder unitrust, as those terms are defined in  26 U.S.C. §
										664, relating to charitable remainder trusts, to the extent provided in
			  26 U.S.C. §
										664.
(1) Corporations and any
			 organization as described in  26 U.S.C. §
											501(c)(3).
(2) Feeder organizations, as described by  26 U.S.C. §
											502, are not exempt from taxation under §
										40-18-25,
Code of Ala. 1975
.
(3) Organizations not exempt from federal
			 income tax due to the requirements of  26 U.S.C. §
											503, relating to
			 requirements for exemption, are not exempt from taxation under §
										40-18-25,
Code of Ala. 1975
.
(4) The unrelated business income of an
			 exempt organization, as defined in  26 U.S.C. §
											512, is not exempt from
			 taxation under §
										40-18-25,
Code of Ala. 1975
. See Reg.
			 810-3-32-.03.
(5) For interpretation of federal statutes
			 adopted by the Alabama Legislature, see Rule 810-3-1.1 -.01, Operating
			 Rules.
(6) The Subchapter J and
			 Business Trust Conformity Act, Act 2006-114, was passed by the Alabama
			 Legislature effective for taxable years beginning after December 31, 2004
			 -please refer to the regulations promulgated to implement the new
			 act.