637.503 Transfers from income to principal for depreciation. 1. For purposes of this section, 'depreciation' means a reduction in value of a fixed asset having a useful life of more than one year due to wear, tear, decay, corrosion, or gradualobsolescence. 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 a transfer shall not be made for depreciationunder any of the following circumstances: a. When the depreciation involves the portion of real property used or available for use by a beneficiary as a residence, or tangible personal property held or made available for thepersonal use or enjoyment of a beneficiary. b. When the depreciation occurs during the administration of a decedent’s estate.c. If the trustee is accounting under section 637.403 for the business or activity in which the asset is used. 3. An amount transferred to principal need not be held as a separate fund.99 Acts, ch 124, §26Referred to in §637.422 Sat Dec 23 12:19:19 2023 Iowa Code 2024, Section 637.503 (16, 0)
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