Title 11 — Title 11 PROBATE AND TRUST LAW

This chapter may be known and cited as the uniform fiduciary income and principal act.[ 2021 c 140 s 2101.]

The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.(1) "Accounting period" means a calendar year, unless a fiduciary selects another period of 12 calendar months or approximately 12 calendar months. The term includes a part…

Except as otherwise provided in the terms of a trust or this chapter, this chapter applies to a trust or estate.[ 2021 c 140 s 2103.]

(1) Except as otherwise provided in the terms of a trust or this chapter, this chapter applies when this state is the principal place of administration of a trust or estate, subject to the following rules:(a) If the trust was created before January 1, 2022, this chapter applies o…

(1) In making an allocation or determination or exercising discretion under this chapter, a fiduciary shall:(a) Act in good faith, based on what is fair and reasonable to all beneficiaries;(b) Administer a trust or estate impartially, except to the extent the terms of the trust m…

(1) In this section, "fiduciary decision" means:(a) A fiduciary's allocation between income and principal or other determination regarding income and principal required or authorized by the terms of the trust or this chapter;(b) The fiduciary's exercise or nonexercise of a discre…

(1) Except as otherwise provided in the terms of a trust or this section, a fiduciary, in a record, without court approval, may adjust between income and principal if the fiduciary determines the exercise of the power to adjust is necessary to administer the trust or estate in ac…

The definitions in this section apply throughout this article unless the context clearly requires otherwise.(1) "Applicable value" means the amount of the net fair market value of a trust taken into account under RCW 11.104B.160.(2) "Express unitrust" means a trust for which, und…

(1) Except as otherwise provided in subsection (2) of this section, this article applies to:(a) An income trust, unless the terms of the trust expressly prohibit use of this article by a specific reference to this article or an explicit expression of intent that net income not be…

(1) A fiduciary, without court approval, by complying with subsections (2) and (6) of this section, may:(a) Convert an income trust to a unitrust if the fiduciary adopts in a record a unitrust policy for the trust providing:(i) That in administering the trust the net income of th…

(1) A notice required by RCW 11.104B.120(2)(b) must be sent to:(a) All beneficiaries that receive or are entitled to receive income from the trust or would be entitled to receive a distribution of principal if the trust were terminated at the time the notice is sent, assuming no …

(1) In administering a unitrust under this article, a fiduciary shall follow a unitrust policy adopted under RCW 11.104B.120(1) (a) or (b) or amended or replaced under RCW 11.104B.120(1)(b).(2) A unitrust policy must provide:(a) The unitrust rate or the method for determining the…

(1) Except as otherwise provided in RCW 11.104B.180(2)(a), a unitrust rate may be:(a) A fixed unitrust rate; or(b) A unitrust rate that is determined for each period using:(i) A market index or other published data; or(ii) A mathematical blend of market indices or other published…

(1) A unitrust policy must provide the method for determining the fair market value of an asset for the purpose of determining the unitrust amount, including:(a) The frequency of valuing the asset, which need not require a valuation in every period; and(b) The date for valuing th…

(1) A unitrust policy must provide the period used under RCW 11.104B.150 and 11.104B.160. Except as otherwise provided in RCW 11.104B.180(2)(c), the period may be:(a) A calendar year;(b) A 12-month period other than a calendar year;(c) A calendar quarter;(d) A three-month period …

(1) A unitrust policy may:(a) Provide methods and standards for:(i) Determining the timing of distributions;(ii) Making distributions in cash or in-kind or partly in cash and partly in-kind; or(iii) Correcting an underpayment or overpayment to a beneficiary based on the unitrust …

(1) The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.(a) "Capital distribution" means an entity distribution of money that is a:(i) Return of capital; or(ii) Distribution in total or partial liquidation of the entity.(…

A fiduciary shall allocate to income an amount received as a distribution of income, including a unitrust distribution under Article 3 of this chapter, from a trust or estate in which the fiduciary has an interest, other than an interest the fiduciary purchased in a trust that is…

(1) This section applies to a business or other activity conducted by a fiduciary if the fiduciary determines that it is in the interests of the beneficiaries to account separately for the business or other activity instead of:(a) Accounting for the business or other activity as …

A fiduciary shall allocate to principal:(1) To the extent not allocated to income under this chapter, an asset received from:(a) An individual during the individual's lifetime;(b) An estate;(c) A trust on termination of an income interest; or(d) A payor under a contract naming th…

To the extent a fiduciary does not account for the management of rental property as a business under RCW 11.104B.220, the fiduciary shall allocate to income an amount received as rent of real or personal property, including an amount received for cancellation or renewal of a leas…

(1) This section does not apply to an obligation to which RCW 11.104B.280, 11.104B.290, 11.104B.300, 11.104B.310, 11.104B.330, 11.104B.340, or 11.104B.350 applies.(2) A fiduciary shall allocate to income, without provision for amortization of premium, an amount received as intere…

(1) This section does not apply to a contract to which RCW 11.104B.280 applies.(2) Except as otherwise provided in subsection (3) of this section, a fiduciary shall allocate to principal the proceeds of a life insurance policy or other contract received by the fiduciary as benefi…

(1) If a fiduciary determines that an allocation between income and principal required by RCW 11.104B.280, 11.104B.290, 11.104B.300, 11.104B.310, or 11.104B.340 is insubstantial, the fiduciary may allocate the entire amount to principal, unless RCW 11.104B.070(5) applies to the a…

(1) The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.(a) "Internal income of a separate fund" means the amount determined under subsection (2) of this section.(b) "Marital trust" means a trust:(i) Of which the settlor'…

(1) In this section, "liquidating asset" means an asset whose value will diminish or terminate because the asset is expected to produce receipts for a limited time. The term includes a leasehold, patent, copyright, royalty right, and right to receive payments during a period of m…

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

(1) To the extent a fiduciary does not account for receipts from the sale of timber and related products as a business under RCW 11.104B.220, the fiduciary shall allocate the net receipts:(a) To income, to the extent the amount of timber cut from the land does not exceed the rate…

(1) If a trust received property for which a gift or estate tax marital deduction was allowed and the settlor's spouse holds a mandatory income interest in the trust, the spouse may require the trustee, to the extent the trust assets otherwise do not provide the spouse with suffi…

(1) In this section, "derivative" means a contract, instrument, other arrangement, or combination of contracts, instruments, or other arrangements, the value, rights, and obligations of which are, in whole or in part, dependent on or derived from an underlying tangible or intangi…

(1) If a fiduciary receives a payment from interest or other current return and from other proceeds of the collateral financial assets, the fiduciary shall allocate to income the portion of the payment which the payer identifies as being from interest or other current return and …

A fiduciary shall allocate receipts from or related to a financial instrument or arrangement not otherwise addressed by this chapter. The allocation must be consistent with RCW 11.104B.330 and 11.104B.340.[ 2021 c 140 s 2416.]

Subject to RCW 11.104B.430, and except as otherwise provided in RCW 11.104B.500(3) (b) or (c), a fiduciary shall disburse from income:(1) One-half of:(a) The regular compensation of the fiduciary and any person providing investment advisory, custodial, or other services to the fi…

(1) Subject to RCW 11.104B.440, and except as otherwise provided in RCW 11.104B.500(3)(b), a fiduciary shall disburse from principal:(a) The balance of the disbursements described in RCW 11.104B.400 (1) and (3) after application of RCW 11.104B.400(2);(b) The fiduciary's compensat…

(1) In this section, "depreciation" means a reduction in value due to wear, tear, decay, corrosion, or gradual obsolescence of a tangible asset having a useful life of more than one year.(2) A fiduciary may transfer to principal a reasonable amount of the net cash receipts from a…

(1) If a fiduciary makes or expects to make an income disbursement described in subsection (2) of this section, the fiduciary may transfer an appropriate amount from principal to income in one or more accounting periods to reimburse income.(2) To the extent the fiduciary has not …

(1) If a fiduciary makes or expects to make a principal disbursement described in subsection (2) of this section, the fiduciary may transfer an appropriate amount from income to principal in one or more accounting periods to reimburse principal or provide a reserve for future pri…

(1) A tax required to be paid by a fiduciary based on receipts allocated to income must be charged to income.(2) A tax required to be paid by a fiduciary based on receipts allocated to principal must be charged to principal, even if the tax is called an income tax by the taxing a…

(1) A fiduciary may make an adjustment between income and principal to offset the shifting of economic interests or tax benefits between current income beneficiaries and successor beneficiaries which arises from:(a) An election or decision the fiduciary makes regarding a tax matt…

(1) This section applies when:(a) The death of an individual results in the creation of an estate or trust; or(b) An income interest in a trust terminates, whether the trust continues or is distributed.(2) A fiduciary of an estate or trust with an income interest that terminates …

(1) Except to the extent Article 3 of this chapter applies for a beneficiary that is a trust, each beneficiary described in RCW 11.104B.500(6) is entitled to receive a share of the net income equal to the beneficiary's fractional interest in undistributed principal assets, using …

(1) An income beneficiary is entitled to net income in accordance with the terms of the trust from the date an income interest begins. The 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:(…

(1) A fiduciary shall allocate an income receipt or disbursement, other than a receipt to which RCW 11.104B.500(2) applies, to principal if its due date occurs before the date on which:(a) For an estate, the decedent died; or(b) For a trust or successive interest, an income inter…

(1) In this section, "undistributed income" means net income received on or before the date on which an income interest ends. The term does not include an item of income or expense which is due or accrued or net income that has been added or is required to be added to principal u…

(1) In applying and construing this uniform act, consideration must be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.(2) To the extent that this chapter is in conflict with RCW 11.68.090, RCW 11.68.090 prevails.[ …

This chapter modifies, limits, or supersedes the electronic signatures in global and national commerce act, 15 U.S.C. Sec. 7001 et seq., but does not modify, limit, or supersede section 101(c) of that act (15 U.S.C. Sec. 7001(c)) or authorize electronic delivery of any of the not…

This chapter applies to a trust or estate existing or created on or after January 1, 2022, except as otherwise expressly provided in the terms of the trust or RCW 11.104B.001 through 11.104B.901.[ 2021 c 140 s 2803.]

Nothing in chapter 345, Laws of 2002 is intended to restrict the application of chapter 11.96A RCW to issues, questions, or disputes that arise under or that relate to chapter 345, Laws of 2002. Any and all such issues, questions, or disputes shall be resolved judicially or nonju…

For the purposes of this chapter, the terms spouse, marriage, marital, husband, wife, widow, widower, next of kin, and family shall be interpreted as applying equally to state registered domestic partnerships or individuals in state registered domestic partnerships as well as to …

Sections 2101 through 2806 of this act take effect January 1, 2022.[ 2021 c 140 s 2809.]