2013 Kentucky Revised Statutes CHAPTER 386 - ADMINISTRATION OF TRUSTS -- LEGAL INVESTMENTS -- UNIFORM PRINCIPAL AND INCOME ACT 386.492 Disbursement from principal.
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386.492 Disbursement from principal.
(1)
(2)
A trustee shall make the following disbursements from principal:
(a) That portion of the regular compensation of the trustee and any person
providing investment advisory or custodial services to the trustee not paid
from income under KRS 386.490(1);
(b) The remaining one-half (1/2) of the disbursements described in KRS
386.490(2);
(c) All of the trustee's compensation calculated on principal as a fee for
acceptance, distribution, or termination, and disbursements made to
prepare property for sale;
(d) Payments on the principal of a trust debt;
(e) Expenses of a proceeding that concerns primarily principal, including a
proceeding to construe the trust or to protect the trust or its property;
(f) Premiums paid on a policy of insurance not described in KRS 386.490(4)
of which the trust is the owner and beneficiary;
(g) Estate, inheritance, and other transfer taxes, including penalties,
apportioned to the trust; and
(h) Disbursements related to environmental matters, including reclamation,
assessing environmental conditions, remedying and removing
environmental contamination, monitoring remedial activities and the
release of substances, preventing future releases of substances,
collecting amounts from persons liable or potentially liable for the costs of
those activities, penalties imposed under environmental laws or
regulations and other payments made to comply with those laws or
regulations, statutory or common law claims by third parties, and
defending claims based on environmental matters.
If a principal asset is encumbered with an obligation that requires income from
that asset to be paid directly to the creditor, the trustee shall transfer from
principal to income an amount equal to the income paid to the creditor in
reduction of the principal balance of the obligation.
Effective:January 1, 2005
History: Created 2004 Ky. Acts ch. 158, sec. 22, effective January 1, 2005.
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