(a) General. A city resident beneficiary of a trust whose city adjusted gross income includes all or part of an accumulation distribution by such trust, as defined in section six hundred sixty-five of the internal revenue code, including a beneficiary who is required to make the modification required by paragraph thirty-six of subdivision (b) of section 11-1712 of this subchapter, shall be allowed (1) a credit against the tax otherwise due under this chapter for all or a proportionate part of any tax paid by the trust under this chapter or under former title T of chapter forty-six of this code, as it was in effect prior to September first, nineteen hundred eighty-six, for any preceding taxable year which would not have been payable if the trust had in fact made distributions to its beneficiaries at the times and in the amounts specified in section six hundred sixty-six of the internal revenue code; and (2) a credit against the taxes imposed by this chapter for the taxable year for any income tax imposed for the taxable year or any prior taxable year by another state of the United States, a political subdivision thereof, or the District of Columbia, upon income both derived therefrom and subject to tax under this chapter, provided that the amount of the credit shall not exceed the percentage of the tax otherwise due under this chapter determined by dividing the portion of the income that is both taxable to the trust in such other jurisdiction and taxable to the beneficiary under this chapter by the total amount of the beneficiary's New York city income.
(b) Limitation. The credits under this section shall not reduce the tax otherwise due from the beneficiary under this chapter to an amount less than would have been due if the accumulation distribution or his or her part thereof were excluded from his or her city adjusted gross income.