§ 16364. — 16364. (Repealed and added by Stats. 2023, Ch. 28, Sec. 2.)

California § 16364.

• Jurisdiction: California
• Code PROB: Probate Code - PROB
• Div. 9.: DIVISION 9. TRUST LAW
• Part 4.: PART 4. TRUST ADMINISTRATION
• Ch. 3.: CHAPTER 3. Uniform Fiduciary Income and Principal Act
• Art. 5.: ARTICLE 5. Allocation of Disbursements

Text

(a)
If a fiduciary makes or expects to make a principal disbursement described in subdivision (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.
(b)
To the extent a fiduciary has not been, and does not expect to be, reimbursed by a third party, principal disbursements to which subdivision (a) applies include all of the following:
(1)
An amount chargeable to income but paid from principal because income is not sufficient.
(2)
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.
(3)
A disbursement made to prepare property for rental, including tenant allowances, leasehold improvements, and commissions.
(4)
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.
(5)
A disbursement described in subdivision (a) of Section 16361.
(c)
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 subdivision (a).

Legislative History

Repealed and added by Stats. 2023, Ch. 28, Sec. 2. (SB 522) Effective January 1, 2024.