Kentucky Statutes 386.494 – Transfers from income to principal for depreciation
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(1) 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.
(2) A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation, but shall not transfer any amount for depreciation:
(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; or
(b) During the administration of a decedent‘s estate.
(3) An amount transferred to principal need not be held as a separate fund.
Effective: January 1, 2005
History: Created 2004 Ky. Acts ch. 158, sec. 23, effective January 1, 2005.
(2) A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation, but shall not transfer any amount for depreciation:
Terms Used In Kentucky Statutes 386.494
- 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
- Decedent: A deceased person.
- Personal property: All property that is not real property.
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
- Trustee: A person or institution holding and administering property in trust.
- Year: means calendar year. See Kentucky Statutes 446.010
(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; or
(b) During the administration of a decedent‘s estate.
(3) An amount transferred to principal need not be held as a separate fund.
Effective: January 1, 2005
History: Created 2004 Ky. Acts ch. 158, sec. 23, effective January 1, 2005.