Cal. Prob. Code § 16362
Allocation of Disbursements
Redline — January 1, 2011 → current.View current text →
Current — January 1, 2023
As of January 1, 2011
(a) In this section, “liquidating asset” means an asset whose value will diminish or terminate because the asset is expected to produce receipts for a period of limited duration. The term includes a leasehold, patent, copyright, royalty right, and right to receive payments under an arrangement that does not provide for the payment of interest on the unpaid balance. The term does not include a payment subject to Section 16361, resources subject to Section 16363, timber subject to Section 16364, an activity subject to Section 16366, an asset subject to Section 16367, or any asset for which the trustee establishes a reserve for depreciation under Section 16372.
(b) A trustee shall allocate to income 10 percent of the receipts from a liquidating asset and the balance to principal.
(a) For purposes of 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.
(b) A fiduciary may transfer to principal a reasonable amount of the net money receipts from a principal asset that is subject to depreciation, but may not transfer any amount for depreciation:
(1) Of the part of real property used or available for use by a beneficiary as a residence.
(2) Of tangible personal property held or made available for the personal use or enjoyment of a beneficiary.
(3) Under this section, to the extent the fiduciary accounts under either of the following:
(A) Section 16349, for the asset.
(B) Section 16342, for the business or other activity in which the asset is used.
(c) An amount transferred to principal under this section need not be separately held.
Official source: California Legislative Information. Reproduced from public-domain California statutes; confirm against the official source for the current text. Not legal advice.