(1) Each beneficiary described in s. 738.201(4) is entitled to receive a portion of the net income remaining after the application of s. 738.201(1)-(3), which is equal to the beneficiary‘s fractional interest in undistributed principal assets, using carrying values as of the distribution date. If a fiduciary makes more than one distribution of assets to beneficiaries to whom this section applies, each beneficiary, including one who does not receive part of the distribution, is entitled, as of each distribution date, to the net income the fiduciary received after the date of death or terminating event or earlier distribution date but has not distributed as of the current distribution date.
(2) In determining a beneficiary’s share of net income, the following applies:
(a) The beneficiary is entitled to receive a portion of the net income equal to the beneficiary’s fractional interest in the carrying value of the undistributed principal assets immediately before the distribution date, excluding the amount of unpaid liabilities.
Terms Used In Florida Statutes 738.202
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Beneficiary: means , in the case of a decedent's estate, an heir or devisee and, in the case of a trust, an income beneficiary or a remainder beneficiary. See Florida Statutes 738.102
- Carrying value: means the fair market value at the time the assets are received by the fiduciary. See Florida Statutes 738.102
- Fair market value: The price at which an asset would change hands in a transaction between a willing, informed buyer and a willing, informed seller.
- Fiduciary: A trustee, executor, or administrator.
- Fiduciary: means a personal representative or a trustee. See Florida Statutes 738.102
- Income: means money or property that a fiduciary receives as current return from a principal asset. See Florida Statutes 738.102
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Net income: means the total receipts allocated to income during an accounting period minus the disbursements made from income during the period, plus or minus transfers under this chapter to or from income during the period. See Florida Statutes 738.102
- Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, or any other legal or commercial entity or a government or governmental subdivision, agency, or instrumentality. See Florida Statutes 738.102
- Principal: means property held in trust for distribution to a remainder beneficiary when the trust terminates. See Florida Statutes 738.102
(b) The beneficiary’s fractional interest in the undistributed principal assets shall be calculated:
1. At the time the interest began and adjusted for any disproportionate distributions since the interest began;
2. By excluding any liabilities of the estate or trust from the calculation;
3. By also excluding property specifically given to a beneficiary and property required to pay pecuniary amounts not in trust; and
4. On the basis of the aggregate carrying value of those assets determined under subsection (1) as of the distribution date.
(c) If a disproportionate distribution of principal is made to any beneficiary, the respective fractional interests of all beneficiaries in the remaining underlying assets shall be recomputed by:
1. Adjusting the carrying value of the principal assets to their fair market value before the distribution;
2. Reducing the fractional interest of the recipient of the disproportionate distribution in the remaining principal assets by the fair market value of the principal distribution; and
3. Recomputing the fractional interests of all beneficiaries in the remaining principal assets based upon the now restated carrying values.
(3) If a fiduciary does not distribute all of the collected but undistributed net income to each person as of a distribution date, the fiduciary shall maintain appropriate records showing the interest of each beneficiary in that net income.
(4) A fiduciary may apply the provisions of this section, to the extent the fiduciary considers appropriate, to net gain or loss realized after the date of death or terminating event or earlier distribution date from the disposition of a principal asset if this section applies to the income from the asset.
(5) The carrying value or fair market value of trust assets shall be determined on an asset-by-asset basis and is conclusive if reasonable and determined in good faith. Determinations of fair market value based on appraisals performed within 2 years before or after the valuation date are presumed reasonable. The values of trust assets are conclusively presumed to be reasonable and determined in good faith unless proven otherwise in a proceeding commenced by or on behalf of a person interested in the trust within the time provided in s. 736.1008.
(6) All distributions to a beneficiary shall be valued based on their fair market value on the date of distribution.