2015 Iowa Code
TITLE XV - JUDICIAL BRANCH AND JUDICIAL PROCEDURES
SUBTITLE 4 - PROBATE — FIDUCIARIES
CHAPTER 637 - UNIFORM PRINCIPAL AND INCOME ACT
Section 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 gradual obsolescence.

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 depreciation under 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 the personal 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.

1999 Acts, ch 124, §26

Referred to in 637.422

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