Title 35, Fiduciaries And Trust Estates

(a) A trustee may, but is not required to, give a notice of proposed action regarding a matter governed by this chapter as provided in this section. For the purpose of this section, a proposed action includes:(1) An individual action;(2) A course of action; or(3) A decision not t…

With respect to a trustee's exercise or nonexercise of the power to make an adjustment under § 35-5-104, the sole remedy is to direct, deny, or revise an adjustment between principal and income.

A trustee who elects to exercise any power or not to exercise any power under this chapter shall maintain only such records that may be necessary or appropriate in the discretion of the trustee to support such determination at the time the determination is made and shall not be r…

(a) In this section:(1) “Disinterested person” means a person who is not a “related or subordinate party,” as defined in 26 U.S.C. § 672(c), with respect to the person then acting as trustee of the trust and excludes the trustor of the trust and any interested trustee;(2) “Income…

(a) This section shall apply to a trust that, by its governing instrument, requires or permits the distribution, at least annually, of a unitrust amount equal to a fixed percentage of not less than three percent (3%) nor more than five percent (5%) per year of the fair market val…

(1) After a decedent dies, in the case of an estate, or after an income interest in a trust ends, the following rules apply:(1) A fiduciary of an estate or of a terminating income interest shall determine the amount of net income and net principal receipts received from property …

(a) Each beneficiary described in § 35-6-201(4) is entitled to receive a portion of the net income equal to the beneficiary's fractional interest in undistributed principal assets, using values as of the distribution date. If a fiduciary makes more than one (1) distribution of as…

(a) An income beneficiary is entitled to net income from the date on which the income interest begins. An income interest begins on the date specified in the terms of the trust or, if no date is specified, on the date an asset becomes subject to a trust or successive income inter…

(a) A trustee shall allocate an income receipt or disbursement other than one to which § 35-6-201(1) applies to principal if its due date occurs before a decedent dies in the case of an estate or before an income interest begins in the case of a trust or successive income interes…

(a) In this section, “undistributed income” means net income received before the date on which an income interest ends. Undistributed income does not include an item of income or expense that is due or accrued or net income that has been added or is required to be added to princi…

(a) In this section, “entity” means a corporation, partnership, limited liability company, regulated investment company, real estate investment trust, common trust fund, or any other organization in which a trustee has an interest other than a trust or estate to which § 35-6-402 …

A trustee shall allocate to income an amount received as a distribution of income from a trust or an estate in which the trust has an interest other than a purchased interest, and shall allocate to principal an amount received as a distribution of principal from such a trust or e…

(a) If a trustee who conducts a business or other activity determines that it is in the best interest of all the beneficiaries to account separately for the business or activity instead of accounting for it as part of the trust's general accounting records, the trustee may mainta…

(1) A trustee shall allocate to principal:(1) To the extent not allocated to income under this chapter, assets received from a transferor during the transferor's lifetime, a decedent's estate, a trust with a terminating income interest, or a payer under a contract naming the trus…

To the extent that a trustee accounts for receipts from rental property pursuant to this section, the trustee shall allocate to income an amount received as rent of real or personal property, including an amount received for cancellation or renewal of a lease. An amount received …

(a) An amount received as interest, whether determined at a fixed, variable, or floating rate, on an obligation to pay money to the trustee, including an amount received as consideration for prepaying principal, must be allocated to income without any provision for amortization o…

(a) Except as otherwise provided in subsection (b), a trustee shall allocate to principal the proceeds of a life insurance policy or other contract in which the trust or its trustee is named as beneficiary, including a contract that insures the trust or its trustee against loss f…

(1) If a trustee determines that an allocation between principal and income required by § 35-6-409, § 35-6-410, § 35-6-411, § 35-6-412, or § 35-6-415 is insubstantial, the trustee may allocate the entire amount to principal unless one (1) of the circumstances described in § 35-6-…

(a) In this section:(1) “Payment” means a payment that a trustee may receive over a fixed number of years or during the life of one (1) or more individuals because of services rendered or property transferred to the payer in exchange for future payments. The term includes a payme…

(a) In this section, “liquidating asset” means an asset whose value will diminish or terminate because the asset is expected to produce receipts for a period of limited duration. Liquidating asset includes a leasehold, patent, copyright, royalty right, and right to receive paymen…

(a) To the extent that a trustee accounts for receipts from an interest in minerals or other natural resources pursuant to this section, the trustee shall allocate them as follows:(1) If received as nominal delay rental or nominal annual rent on a lease, a receipt must be allocat…

(a) To the extent that a trustee accounts for receipts from the sale of timber and related products pursuant to this section, the trustee shall allocate the net receipts to:(1) Income to the extent that the amount of timber removed from the land does not exceed the rate of growth…

(a) If a marital deduction is allowed for all or part of a trust whose assets consist substantially of property that does not provide the spouse with sufficient income from or use of the trust assets, and if the amounts that the trustee transfers from principal to income under § …

(a) In this section, “derivative” means a contract or financial instrument or a combination of contracts and financial instruments which gives a trust the right or obligation to participate in some or all changes in the price of a tangible or intangible asset or group of assets, …

(a) In this section, “asset-backed security” means an asset whose value is based upon the right it gives the owner to receive distributions from the proceeds of financial assets that provide collateral for the security. Asset-backed securities includes an asset that gives the own…

(1) A trustee shall make the following disbursements from income to the extent that they are not disbursements to which § 35-6-201(2)(B) or (C) applies:(1) One-half (½) of the regular compensation of the trustee and of any person providing investment advisory or custodial service…

(a) A trustee shall make the following disbursements from principal:(1) The remaining one-half (½) of the disbursements described in § 35-6-501(1) and (2); however, if in the judgment of the trustee, the charging of a part or all of that portion of the compensation described unde…

(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 (1) year. (b) A trustee may transfer to principal a reasonable amount of the net cash receipts from a…

(a) If a trustee makes or expects to make a principal disbursement described in this section, the trustee may transfer an appropriate amount from income to principal in one (1) or more accounting periods to reimburse principal or to provide a reserve for future principal disburse…

(a) A tax required to be paid by a trustee based on receipts allocated to income must be paid from income. (b) A tax required to be paid by a trustee based on receipts allocated to principal must be paid from principal, even if the tax is called an income tax by the taxing author…

(a) A fiduciary may make adjustments between principal and income to offset the shifting of economic interests or tax benefits between income beneficiaries and remainder beneficiaries which arise from:(1) Elections and decisions, other than those described in subsection (b), that…

Section 35-15-1101 controls all application and construction of chapter 6.

This act applies to every trust or decedent's estate existing on or after July 1, 2000, except as otherwise expressly provided in the will or terms of the trust or in this act.