03. Transfers from income to principal for depreciation. (a) For the purposes of this section, the term '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 year. (b) A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation, but may not transfer any amount for depreciation: (1) 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; (2) During the administration of a decedent’s estate; or (3) Under this section if the trustee is accounting under § 28-4804.03 for the business or activity in which the asset is used. (c) An amount transferred to principal need not be held as a separate fund. (Apr. 27, 2001, D.C. Law 13-292, § 502(c), 48 DCR 2087.) Section References This section is referenced in § 28-4804.10. Editor's Notes Uniform Law: This section is based upon § 503 of the Uniform Principal and Income Act (1997 Act).
District of Columbia Legal Code