A. If a fiduciary makes or expects to make a principal disbursement described in subsection B, the fiduciary may transfer an appropriate amount from income to principal in one or more accounting periods to reimburse principal or provide a reserve for future principal disbursements.\nB. To the extent a fiduciary has not been and does not expect to be reimbursed by a third party, principal disbursements to which subsection A applies include:\n1. An amount chargeable to income but paid from principal because income is not sufficient;\n2. The cost of an improvement to principal, whether a change to an existing asset or the construction of a new asset, including a special assessment;\n3. A disbursement made to prepare property for rental, including tenant allowances, leasehold improvements, and commissions;\n4. A periodic payment on an obligation secured by a principal asset, to the extent the amount transferred from income to principal for depreciation is less than the periodic payment; and\n5. A disbursement described in subsection A of § 64.2-1065.\nC. If an asset whose ownership gives rise to a principal disbursement becomes subject to a successive interest after an income interest d\n5. A disbursement described in subsection A of § 64.2-1065.\nC. If an asset whose ownership gives rise to a principal disbursement becomes subject to a successive interest after an income interest ends, the fiduciary may continue to make transfers under subsection A.\n2022, c. 354.
Virginia Legal Code