§ 15-1.2-403 — Business of other activity conducted by fiduciary

Colorado § 15-1.2-403

• Jurisdiction: Colorado
• Title 15: Probate,
• Art.: Uniform Fiduciary Income and Principal Act

Text

(1) This
section applies to a business or other activity conducted by a fiduciary if the
fiduciary determines that it is in the interests of the beneficiaries to account
separately for the business or other activity instead of:

(a) Accounting for the business or other activity as part of the fiduciary's
general accounting records; or

(b) Conducting the business or other activity through an entity described in
section 15-1.2-401 (1)(b)(I).

(2) A fiduciary may account separately under this section for the
transactions of a business or other activity, whether or not assets of the business or
other activity are segregated from other assets held by the fiduciary.

(3) A fiduciary that accounts separately under this section for a business or
other activity:

(a) May determine:

(I) The extent to which the net cash receipts of the business or other activity
must be retained for:

(A) Working capital;

(B) The acquisition or replacement of fixed assets; and

(C) Other reasonably foreseeable needs of the business or other activity; and

(II) The extent to which the remaining net cash receipts are accounted for as
principal or income in the fiduciary's general accounting records for the trust;

(b) May make a determination under subsection (3)(a) of this section
separately and differently from the fiduciary's decisions concerning distributions of
income or principal; and

(c) Shall account for the net amount received from the sale of an asset of the
business or other activity, other than a sale in the ordinary course of the business or
other activity, as principal in the fiduciary's general accounting records for the
trust, to the extent the fiduciary determines that the net amount received is no
longer required in the conduct of the business or other activity.

(4) Activities for which a fiduciary may account separately under this section
include:

(a) Retail, manufacturing, service, and other traditional business activities;

(b) Farming;

(c) Raising and selling livestock and other animals;

(d) Managing rental properties;

(e) Extracting minerals, water, and other natural resources;

(f) Growing and cutting timber;

(g) An activity to which section 15-1.2-414, 15-1.2-415, or 15-1.2-416 applies;
and

(h) Any other business conducted by the fiduciary.

Legislative History

Source: L. 2021: Entire article added, (SB 21-171), ch. 143, p. 822, � 1, effective January 1, 2022.