(1) As used in this section:

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Terms Used In Utah Code 75A-5-409

  • Accounting period: includes a part of a calendar year or another period of 12 calendar months or approximately 12 calendar months that begins when an income interest begins or ends when an income interest ends. See Utah Code 75A-5-102
  • Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
  • 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 :
         (3)(a) for a trust:
              (3)(a)(i) a current beneficiary, including a current income beneficiary and a beneficiary that may receive only principal;
              (3)(a)(ii) a remainder beneficiary; and
              (3)(a)(iii) any other successor beneficiary;
         (3)(b) for an estate, an heir and devisee; and
         (3)(c) for a life estate or term interest, a person that holds a life estate, term interest, or remainder, or other interest following a life estate or term interest. See Utah Code 75A-5-102
  • Current income beneficiary: means a beneficiary to which a fiduciary may distribute net income, even if the fiduciary also may distribute principal to the beneficiary. See Utah Code 75A-5-102
  • Distribution: means a payment or transfer by a fiduciary to a beneficiary in the beneficiary's capacity as a beneficiary, made under the terms of the trust, without consideration other than the beneficiary's right to receive the payment or transfer under the terms of the trust. See Utah Code 75A-5-102
  • Equal: means , with respect to biological sex, of the same value. See Utah Code 68-3-12.5
  • Estate: includes 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 Utah Code 75A-5-102
  • Fiduciary: A trustee, executor, or administrator.
  • Fiduciary: includes :
         (8)(a) a trustee, trust director as defined in Section 75-12-102, personal representative, life tenant, holder of a term interest, and person acting under a delegation from a fiduciary;
         (8)(b) a person that holds property for a successor beneficiary whose interest may be affected by an allocation of receipts and expenditures between income and principal; and
         (8)(c) if there are two or more co-fiduciaries, all co-fiduciaries acting under the terms of the trust and applicable law. See Utah Code 75A-5-102
  • Income: includes a part of receipts from a sale, exchange, or liquidation of a principal asset to the extent provided in Part 4, Allocation of Receipts. See Utah Code 75A-5-102
  • Marital deduction: The deduction(s) that can be taken in the determination of gift and estate tax liabilities because of the existence of a marriage or marital relationship.
  • Month: means a calendar month, unless otherwise expressed. See Utah Code 68-3-12.5
  • Net income: includes an adjustment from principal to income under Section 75A-5-203. See Utah Code 75A-5-102
  • Principal: means property held in trust for distribution to, production of income for, or use by a current or successor beneficiary. See Utah Code 75A-5-102
  • Property: includes both real and personal property. See Utah Code 68-3-12.5
  • Settlor: means the same as that term is defined in Section 75-7-103. See Utah Code 75A-5-102
  • Trust: includes :
              (23)(a)(i) an express trust, private or charitable, with additions to the trust, wherever and however created; and
              (23)(a)(ii) a trust created or determined by judgment or decree under which the trust is to be administered in the manner of an express trust. See Utah Code 75A-5-102
     (1)(a) “Internal income of a separate fund” means the amount determined under Subsection (2).
     (1)(b) “Marital trust” means a trust:

          (1)(b)(i) of which the settlor‘s surviving spouse is the only current income beneficiary and is entitled to a distribution of all the current net income of the trust; and
          (1)(b)(ii) that qualifies for a marital deduction with respect to the settlor’s estate under Section 2056 of the Internal Revenue Code because:

               (1)(b)(ii)(A) an election to qualify for a marital deduction under Section 2056(b)(7) of the Internal Revenue Code has been made; or
               (1)(b)(ii)(B) the trust qualifies for a marital deduction under Section 2056(b)(5) of the Internal Revenue Code.
     (1)(c)

          (1)(c)(i) “Payment” means an amount a fiduciary may receive over a fixed number of years or during the life of one or more individuals because of services rendered or property transferred to the payor in exchange for future amounts the fiduciary may receive.
          (1)(c)(ii) “Payment” includes an amount received in money or property from the payor’s general assets or from a separate fund created by the payor.
     (1)(d) “Separate fund” includes a private or commercial annuity, an individual retirement account, and a pension, profit-sharing, stock-bonus, or stock-ownership plan.
(2) For each accounting period, and for each separate fund:

     (2)(a) the fiduciary shall determine the internal income of the separate fund as if the separate fund were a trust subject to this chapter;
     (2)(b) if the fiduciary cannot determine the internal income of the separate fund under Subsection (2)(a), the internal income of the separate fund is deemed to equal 3% of the value of the separate fund, according to the most recent statement of value preceding the beginning of the accounting period; and
     (2)(c) if the fiduciary cannot determine the value of the separate fund under Subsection (2)(b), the value of the separate fund is deemed to equal the present value of the expected future payments, as determined under Section 7520 of the Internal Revenue Code, for the month preceding the beginning of the accounting period for which the computation is made.
(3) A fiduciary shall allocate a payment received from a separate fund during an accounting period to income, to the extent of the internal income of the separate fund during the accounting period, and the balance to principal.
(4) The fiduciary of a marital trust shall:

     (4)(a) withdraw from a separate fund the amount the current income beneficiary of the trust requests the fiduciary to withdraw, not greater than the amount by which the internal income of the separate fund during the accounting period exceeds the amount the fiduciary otherwise receives from the separate fund during the accounting period;
     (4)(b) transfer from principal to income the amount the current income beneficiary requests the fiduciary to transfer, not greater than the amount by which the internal income of the separate fund during the accounting period exceeds the amount the fiduciary receives from the separate fund during the accounting period after the application of Subsection (4)(a); and
     (4)(c) distribute to the current income beneficiary as income:

          (4)(c)(i) the amount of the internal income of the separate fund received or withdrawn during the accounting period; and
          (4)(c)(ii) the amount transferred from principal to income under Subsection (4)(b).
(5) For a trust, other than a marital trust, of which one or more current income beneficiaries are entitled to a distribution of all the current net income, the fiduciary shall transfer from principal to income the amount by which the internal income of a separate fund during the accounting period exceeds the amount the fiduciary receives from the separate fund during the accounting period.

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