59-16.3-01. Definitions.
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For purposes of this chapter, unless the context otherwise requires:
1. "Disinterested person" means a person who is not a related or subordinate party, as
defined in section 672(c) of the Internal Revenue Code [26 U.S.C. 1, et seq.], with
respect to the person then acting as trustee of the trust and excludes the settlor of the
trust and any interested trustee.
2. "Income trust" means a trust, created by either an inter vivos or a testamentary
instrument, which directs or permits the trustee to distribute the net income of the trust
to one or more persons, either in fixed proportions, or in amounts, or proportions
determined by the trustee. However, a trust that otherwise is an income trust may not
qualify if it is subject to taxation under section 2001 or section 2501 of the Internal
Revenue Code, until the expiration of the period for filing the return therefor.
3. "Interested distributee" means a person to whom distributions of income or principal
can currently be made who has the power to remove the existing trustee and
designate as successor a person who may be a related or subordinate party, as
defined in section 672(c) of the Internal Revenue Code, with respect to such
distributee.
4. "Interested trustee" means:
a. Any individual trustee to whom the net income or principal of the trust can
currently be distributed or would be distributed if the trust were then to terminate
and be distributed; and
b. An individual trustee whose legal obligation to support a beneficiary may be
satisfied by distributions of income and principal of the trust.
5. "Total return unitrust" means an income trust that has been converted under and
meets the provisions of this chapter.
6. "Trustee" means all persons acting as trustee of the trust, except where expressly
noted otherwise, whether acting in their discretion, or on the direction of one or more
persons acting in a fiduciary capacity.
7. "Settlor" means an individual who created an inter vivos or a testamentary trust.
8. "Unitrust" means a trust, the terms of which require or permit distribution of a unitrust
amount, without regard to whether the trust has been converted to a unitrust in
accordance with this chapter, or whether the trust is established by express terms of
the governing instrument.
9. "Unitrust amount" means an amount equal to a percentage of a unitrust's assets that
may, or are required, to be distributed to one or more beneficiaries annually in
accordance with the terms of the unitrust. The unitrust amount may be determined by
reference to the net fair market value of the unitrust's assets as of a particular date
each year, or as an average determined on a multiple year basis.
10. "Current valuation year" means the accounting period of the trust for which the unitrust
amount is being determined.
11. "Prior valuation year" means each of the two accounting periods of the trust
immediately preceding the current valuation year.