Insubstantial allocation between principal and income
Sec. 30. If a trustee determines that an allocation between
principal and income required by section 31, 32, 33, 34, or 37 of this
chapter is insubstantial, the trustee may allocate the entire amount to
principal unless one (1) of the circumstances described in section
15(c) of this chapter applies to the allocation. This power may be
exercised by a cotrustee in the circumstances described in section
15(d) of this chapter and may be released for the reasons and in the
manner described in section 15(e) of this chapter. An allocation is
presumed to be insubstantial if:
(1) the amount of the allocation would increase or decrease net
income in an accounting period, as determined before the
allocation, by less than ten percent (10%); or
(2) the value of the asset producing the receipt for which the
allocation would be made is less than ten percent (10%) of the
total value of the trust's assets at the beginning of the
accounting period.
As added by P.L.84-2002, SEC.2.
Last modified: May 27, 2006