(1) Except to the extent that ss. 738.301–738.310 apply for a beneficiary that is a trust, each beneficiary described in s. 738.601(5) is entitled to receive a share of the net income equal to the beneficiary’s fractional interest in undistributed principal assets, using carrying values as of the distribution date. If a fiduciary makes more than one distribution of assets to beneficiaries to which this section applies, each beneficiary, including a beneficiary who does not receive part of the distribution, is entitled, as of each distribution date, to a share of the net income the fiduciary received after the decedent‘s death, an income interest‘s other terminating event, or the preceding distribution by the fiduciary.
(2) In determining a beneficiary’s share of net income under subsection (1), the following rules apply:

(a) The beneficiary is entitled to receive a share of the net income equal to the beneficiary’s fractional interest in the undistributed principal assets immediately before the distribution date.
will 560x170

Ask a will, trust or estate question, get an answer ASAP!
Thousands of highly rated, verified estate & trust lawyers.
Click here to chat with a lawyer about your rights.

Terms Used In Florida Statutes 738.602

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • 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
  • Beneficiary: includes :
    (a) For a trust:
    1. See Florida Statutes 738.102
  • Carrying value: means the fair market value at the time the assets are received by the fiduciary. See Florida Statutes 738.102
  • Decedent: A deceased person.
  • Distribution: means a payment or transfer by a fiduciary to a beneficiary in the beneficiary's capacity as a beneficiary, without consideration other than the beneficiary's right to receive the payment or transfer under the terms of the trust as defined in this section, will, life estate, or term interest. See Florida Statutes 738.102
  • Estate: means a decedent's estate, including the property of the decedent as the estate is originally constituted and the property of the estate as it exists at any time during administration. See Florida Statutes 738.102
  • Fair market value: The price at which an asset would change hands in a transaction between a willing, informed buyer and a willing, informed seller.
  • Fiduciary: A trustee, executor, or administrator.
  • Fiduciary: includes a trustee, a trust director as defined in…. See Florida Statutes 738.102
  • Income: means money or other property a fiduciary receives as current return from principal. See Florida Statutes 738.102
  • Income interest: means the right of a current income beneficiary to receive all or part of net income, whether the terms of the trust require the net income to be distributed or authorize the net income to be distributed in the fiduciary's discretion. See Florida Statutes 738.102
  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
  • Net income: means the total allocations during an accounting period to income under the terms of a trust and this chapter minus the disbursements during the period, other than distributions, allocated to income under the terms of the trust and this chapter. See Florida Statutes 738.102
  • Person: means an individual; a business or a nonprofit entity; an estate; a trust; a public corporation; a government or governmental subdivision, agency, or instrumentality; or other legal entity. See Florida Statutes 738.102
  • Principal: means property held in trust for distribution to, production of income for, or use by a current or successor beneficiary. See Florida Statutes 738.102
  • Trust: includes an express trust, whether private or charitable, with additions to the trust, wherever and however created; and a trust created or determined by a judgment or decree under which the trust is to be administered in the manner of an express trust. See Florida Statutes 738.102
(b) The beneficiary’s fractional interest under paragraph (a) must be calculated:

1. On the aggregate carrying value of the assets as of the distribution date; and
2. Reduced by:

a. Any liabilities of the estate or trust;
b. Property specifically given to a beneficiary under the decedent’s will or the terms of the trust; and
c. Property required to pay pecuniary amounts not in trust.
(c) If a disproportionate distribution of principal is made to any beneficiary, the respective fractional interests of all beneficiaries in the undistributed principal assets must be recomputed by:

1. Adjusting the carrying value of the principal assets to their fair market value before the distribution;
2. Reducing the fractional interest of the recipient of the disproportionate distribution in the remaining principal assets by the fair market value of the principal distribution; and
3. Recomputing the fractional interests of all beneficiaries in the remaining principal assets based upon the now restated carrying values.
(d) The distribution date under paragraph (a) may be the date as of which the fiduciary calculates the value of the assets if that date is reasonably near the date on which the assets are distributed. All distributions to a beneficiary must be valued based on the assets’ fair market value on the date of the distribution.
(3) To the extent that a fiduciary does not distribute under this section all the collected but undistributed net income to each beneficiary as of a distribution date, the fiduciary shall maintain records showing the interest of each beneficiary in the net income.
(4) If this section applies to income from an asset, a fiduciary may apply the requirements in this section to net gain or loss realized from the disposition of the asset after the decedent’s date of death, an income interest’s terminating event, or the preceding distribution by the fiduciary.
(5) The carrying value or fair market value of trust assets shall be determined on an asset-by-asset basis and is conclusive if reasonable and determined in good faith. Determinations of fair market value based on appraisals performed within 2 years before or after the valuation date are presumed reasonable. The values of trust assets are conclusively presumed to be reasonable and determined in good faith unless proven otherwise in a proceeding commenced by or on behalf of a person interested in the trust within the time provided in s. 736.1008.
  Previous section
Next section  
 Chapter 738 Contents