Section 7-463 - Transfers from income to principal for depreciation1.Depreciation. As used 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. [2017, c. 402, Pt. A, §2(NEW); 2019, c. 417, Pt. B, §14(AFF).]
2.Reasonable amount of net cash receipts. 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 for depreciation any amount:A. 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; [2017, c. 402, Pt. A, §2(NEW); 2019, c. 417, Pt. B, §14(AFF).]B. During the administration of a decedent's estate; or [2017, c. 402, Pt. A, §2(NEW); 2019, c. 417, Pt. B, §14(AFF).]C. Under this section if the trustee is accounting under section 7-443 for the business or activity in which the asset is used. [2017, c. 402, Pt. A, §2(NEW); 2019, c. 417, Pt. B, §14(AFF).] [2017, c. 402, Pt. A, §2(NEW); 2019, c. 417, Pt. B, §14(AFF).]
3.Separate fund not required. An amount transferred to principal pursuant to subsection 2 need not be held as a separate fund. [2017, c. 402, Pt. A, §2(NEW); 2019, c. 417, Pt. B, §14(AFF).]
Amended by 2019, c. 417,§ B-14, eff. 6/20/2019.Added by 2018, c. 402,§ A-2, eff. 7/1/2019.