2019 Tennessee Code
Title 35 - Fiduciaries and Trust Estates
Chapter 6 - Uniform Principal and Income Act
Part 5 - Allocation of Disbursements During Administration of Trust
§ 35-6-503. Transfers from income to principal for depreciation.

Universal Citation: TN Code § 35-6-503 (2019)
  • (a) In this section, “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 (1) 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 § 35-6-403 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.

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