Section 28-72-505 - Tax and penalty on earnings

(a)(1) All distributions of funds from the long-term intergenerational security trust shall be taxable as provided in the Income Tax Act of 1929.(2) All distributions from the trust shall be deemed principal until all contributions of principal have been withdrawn.(b)(1) In addition to any income tax imposed for distributions from the long-term intergenerational security trust as provided in subsection (a) of this section, there is imposed a twenty percent (20%) penalty on all distributions from the trust in violation of this subchapter.(2) The penalty shall be collected by the Department of Finance and Administration and shall be deposited into the State Treasury as general revenue.Acts 1995, No. 1303, §§ 4, 7; 1997, No. 1345, § 2.