Nevada Revised Statutes 163.557 – Circumstances under which trustee is authorized to reimburse settlor for tax on trust income or principal
1. A governing trust instrument may authorize the trustee, in the sole discretion of the trustee or at the direction or with the consent of a directing trust adviser, to reimburse a settlor for all or a portion of tax on trust income or principal that is payable by the settlor under the law imposing such tax. In the sole discretion of the trustee, the trustee may pay such amount to the settlor directly or to an appropriate taxing authority on behalf of the settlor.
Terms Used In Nevada Revised Statutes 163.557
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- person: means a natural person, any form of business or social organization and any other nongovernmental legal entity including, but not limited to, a corporation, partnership, association, trust or unincorporated organization. See Nevada Revised Statutes 0.039
- Trustee: A person or institution holding and administering property in trust.
2. A trustee or directing trust adviser is not liable to any person in exercising such discretion to reimburse or not reimburse a settlor for tax payable by the settlor on trust income or principal pursuant to subsection 1.
3. The power of a trustee to make a payment to or for the benefit of a settlor in accordance with subsection 1 or the decision of a trustee to exercise such power in favor of the settlor must not cause the settlor to be treated as a beneficiary for purposes of the laws of this State. As used in this subsection, ‘beneficiary’ has the meaning ascribed to it in NRS 163.4147.