Iowa Code 637.610 – Procedure upon conversion of income trust to total return unitrust
Current as of: 2023 | Check for updates
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Following the conversion of an income trust to a total return unitrust, the trustee:
1. Shall treat the unitrust amount as if it were net income of the trust for purposes of determining the amount available, from time to time, for distribution from the trust.
Terms Used In Iowa Code 637.610
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- Income: means money or property a fiduciary receives as the current return from a principal asset. See Iowa Code 637.102
- Net income: means the total receipts allocated to income during an accounting period minus the disbursements made from income during the period. See Iowa Code 637.102
- Principal: means property held in trust for distribution to a remainder beneficiary when the trust terminates. See Iowa Code 637.102
2. Shall allocate an amount to trust income, not in excess of the annual unitrust payout amount, in the following order:
a. The amount derived from net income, as determined if the trust were other than a total return unitrust.
b. The amount derived from other ordinary income as determined for federal income tax purposes.
c. The amount derived from net realized short-term capital gains as determined for federal income tax purposes.
d. The amount derived from net realized long-term capital gains as determined for federal income tax purposes.
e. The amount derived from trust principal.