§ 55-277.27. Transfers from income to principal for depreciation
A. In this section, "depreciation" means a reduction in value due to wear, tear, decay, corrosion, or gradual obsolescence of a fixed asset having a useful life of more than one year.
B. A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation, but may not transfer any amount for depreciation:
1. Of that portion of real property used or available for use by a beneficiary as a residence or of tangible personal property held or made available for the personal use or enjoyment of a beneficiary;
2. During the administration of a decedent's estate; or
3. Under this section if the trustee is accounting under § 55-277.12 for the business or activity in which the asset is used.
C. An amount transferred to principal need not be held as a separate fund.
(1999, c. 975.)
Sections: Previous 55-277.19 55-277.20 55-277.21 55-277.22 55-277.23 55-277.24 55-277.25 55-277.26 55-277.27 55-277.28 55-277.29 55-277.30 55-277.31 55-277.32 55-277.33 NextLast modified: April 16, 2009