NC H873

Modifies G.S. 105-160.2 to clarify that the taxable income of estates and trusts is determined under federal tax Code provisions, adjusted per G.S. 105-153.5 and 105-153.6, with adjustments apportioned between the estate or trust and beneficiaries based on distributions made during the taxable year.

Specifies that state income tax applies to estates and trusts on income derived from North Carolina sources (including real or tangible personal property ownership in the state) and income from businesses, trades, professions, or occupations carried on in the state.

Establishes that estates are subject to tax when the decedent died a resident of North Carolina or when a state resident is certain to receive income or other benefit from the estate.

Establishes that trusts are subject to tax on income for the benefit of a North Carolina resident when the trust is administered in the state.

Defines long-term estates as those remaining open for more than 50 years from the decedent's date of death and requires them to be taxed as trusts.

Effective for taxable years beginning on or after January 1, 2023.