North Carolina General Statutes Chapter 36C. North Carolina Uniform Trust Code § 36C-1-113. Construction of certain formula clauses applicable to estates of decedents dying in calendar year 2010

(1) To a trust instrument or an amendment to a trust instrument executed by a settlor before December 31, 2009, that contains a formula provision described in subsection (c) of this section if the settlor dies after December 31, 2009, and before the earlier of January 1, 2011, and the effective date of the reinstatement of the federal estate tax and generation-skipping transfer tax, unless the instrument or amendment clearly manifests an intent that a rule contrary to the rule of construction described in subsection (c) of this section applies.

(2) To the terms of a trust instrument or an amendment to a trust instrument executed by a settlor who dies before December 31, 2009, providing for a disposition of property that contains a formula provision described in subsection (c) of this section and occurs as a result of the death of another individual who dies after December 31, 2009, and before the earlier of January 1, 2011, and the effective date of the reinstatement of the federal estate tax and generation-skipping transfer tax, unless the terms of the instrument or amendment clearly manifests an intent that a rule contrary to the rule of construction described in subsection (c) of this section applies.

(1) The formula refers to any of the following: “applicable credit amount,” “applicable exclusion amount,” “applicable exemption amount,” “applicable fraction,” “estate tax exemption,” “generation-skipping transfer tax exemption,” “GST exemption,” “inclusion ratio,” “marital deduction,” “maximum marital deduction,” “unified credit,” or “unlimited marital deduction.”

(2) The formula measures a share of a trust based on the amount that can pass free of federal estate taxes or the amount that can pass free of federal generation-skipping transfer taxes.

(3) The formula is otherwise based on a provision of federal estate tax or federal generation-skipping transfer tax law similar to the provisions in subdivision (1) or (2) of this subsection.