(a) For purposes of 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 more than one year under an arrangement that does not provide for the payment of interest on the unpaid balance.
(b) This section does not apply to a receipt subject to Section 16340, 16348, 16350, 16351, 16353, 16354, 16355, or 16362.
(c) A fiduciary shall make allocations in the following manner:
(1) To income:
(A) A receipt produced by a liquidating asset, to the extent the receipt does not exceed 4 percent of the value of the asset.
(B) If the fiduciary cannot determine the value of the asset, 10 percent of the receipt.
(2) To principal, the balance of the receipt.