43-1381. Credit for taxes paid to other state or country

A. If an estate or trust is a resident of this state and also a resident of another state or country, the estate or trust is allowed a credit against the taxes imposed by this title for net income taxes imposed by and paid to the other state or country, subject to the following conditions:

1. The credit is allowed only for the proportion of the taxes paid to the other state or country that the income taxable under this title and also subject to tax in the other state or country bears to the entire income on which the taxes paid to the other state or country are imposed.

2. The credit shall not exceed the proportion of the tax payable under this title that the income subject to tax in the other state or country and also taxable under this title bears to the entire income that is taxable under this title.

3. The credit shall not be allowed for taxes paid to the other state or country on income from sources within this state.

B. If any taxes paid to another state or country for which a taxpayer has been allowed a credit under this section are at any time credited or refunded to the taxpayer, the taxpayer shall immediately report this fact to the department.

C. A tax equal to the credit allowed for the taxes credited or refunded by the other state or country is due and payable from the taxpayer on notice and demand from the department.

D. For the purposes of this section, an estate or trust is considered to be a resident of the state or country that is legally entitled to tax the income of the estate or trust regardless of whether the income is derived from sources in that state or country.

E. For purposes of this section, net income taxes imposed by another country shall include those taxes that qualify for a credit under sections 901 and 903 of the internal revenue code and the regulations thereunder.