Income receipts and disbursements
Sec. 21. (a) A trustee shall allocate an income receipt or
disbursement other than one to which section 18(1) of this chapter
applies to principal if its due date occurs before:
(1) an individual dies in the case of an estate; or
(2) an income interest begins in the case of a trust or successive
income interest.
(b) A trustee shall allocate an income receipt or disbursement to
income if its due date occurs on or after the date on which an
individual dies or an income interest begins and it is a periodic due
date. An income receipt or disbursement must be treated as accruing
from day to day if its due date is not periodic or it has no due date.
The portion of the receipt or disbursement accruing before the date
on which an individual dies or an income interest begins must be
allocated to principal and the balance must be allocated to income.
(c) An item of income or an obligation is due on the date the payer
is required to make a payment. If a payment date is not stated, there
is no due date for the purposes of this chapter. Distributions to
shareholders or other owners from an entity to which section 23 of
this chapter applies are considered to be due on:
(1) the date fixed by the entity for determining who is entitled
to receive the distribution; or
(2) if no date is fixed, the declaration date for the distribution.
A due date is periodic for receipts or disbursements that must be paid
at regular intervals under a lease or an obligation to pay interest or
if an entity customarily makes distributions at regular intervals.
As added by P.L.84-2002, SEC.2.
Last modified: May 27, 2006