S.C. Code Ann. § 62-7-429 – Payment of taxes from income and principal

(A) A tax required to be paid by a trustee based on receipts allocated to income must be paid from income.
(B) A tax required to be paid by a trustee based on receipts allocated to principal must be paid from principal, even if the tax is called an income tax by the taxing authority.
(C) A tax required to be paid by a trustee on the trust's share of the taxable income of the entity must be paid proportionately from:
1. (1) income, to the extent that receipts from the entity are allocated to income; and
2. (2) principal, to the extent that:
  1. (a) receipts from the entity are allocated to principal; and
  2. (b) the trust's share of the taxable income of the entity exceeds the total receipts described in items (1) and (2)(a).
(D) For purposes of this section, receipts allocated to principal or income must be reduced by the amount distributed to a beneficiary from principal or income for which the trust receives a deduction in calculating the tax.