Iowa Code 637.503 – Transfers from income to principal for depreciation
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Terms Used In Iowa Code 637.503
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Decedent: A deceased person.
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- property: includes personal and real property. See Iowa Code 4.1
- Trustee: A person or institution holding and administering property in trust.
- year: means twelve consecutive months. See Iowa Code 4.1
637.503 Transfers from income to principal for depreciation.
1. For purposes of this section, “”depreciation”” means a reduction in value of a fixed asset
having a useful life of more than one year due to wear, tear, decay, corrosion, or gradual obsolescence.
2. A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation, but a transfer shall not be made for depreciation under any of the following circumstances:
a. When the depreciation involves the portion of real property used or available for use by a beneficiary as a residence, or tangible personal property held or made available for the personal use or enjoyment of a beneficiary.
b. When the depreciation occurs during the administration of a decedent‘s estate.
c. If the trustee is accounting under § 637.403 for the business or activity in which the asset is used.
3. An amount transferred to principal need not be held as a separate fund.
99 Acts, ch 124, §26
Referred to in §637.422
1. For purposes of this section, “”depreciation”” means a reduction in value of a fixed asset
having a useful life of more than one year due to wear, tear, decay, corrosion, or gradual obsolescence.
2. A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation, but a transfer shall not be made for depreciation under any of the following circumstances:
a. When the depreciation involves the portion of real property used or available for use by a beneficiary as a residence, or tangible personal property held or made available for the personal use or enjoyment of a beneficiary.
b. When the depreciation occurs during the administration of a decedent‘s estate.
c. If the trustee is accounting under § 637.403 for the business or activity in which the asset is used.
3. An amount transferred to principal need not be held as a separate fund.
99 Acts, ch 124, §26
Referred to in §637.422