Arkansas § 28-77-503 Transfer from income to principal for depreciation

Arkansas Statutes

§ 28-77-503 — Transfer from income to principal for depreciation

(a)In this section, "depreciation" means a reduction in value due to wear, tear, decay, corrosion, or gradual obsolescence of a tangible asset having a useful life of more than one year.

(b)A fiduciary 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 the part of real property used or available for use by a beneficiary as a residence;

(2)of tangible personal property held or made available for the personal use or enjoyment of a beneficiary; or (3) under this section, to the extent the fiduciary accounts:

(A)under § 28-77-410 for the asset; or (B) under § 28-77-403 for the business or other activity in which the asset is used.

(c)An amount transferred to

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(a) In this section, "depreciation" means a reduction in value due to wear, tear, decay, corrosion, or gradual obsolescence of a tangible asset having a useful life of more than one year. (b) A fiduciary 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 the part of real property used or available for use by a beneficiary as a residence; (2) of tangible personal property held or made available for the personal use or enjoyment of a beneficiary; or (3) under this section, to the extent the fiduciary accounts: (A) under § 28-77-410 for the asset; or (B) under § 28-77-403 for the business or other activity in which the asset is used. (c) An amount transferred to principal under this section need not be separately held.

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