55-277.6 - Distribution to residuary and remainder beneficiaries.
§ 55-277.6. Distribution to residuary and remainder beneficiaries.
A. Each beneficiary described in subdivision 4 of § 55-277.5 is entitled toreceive a portion of the net income equal to the beneficiary's fractionalinterest in undistributed principal assets, using values as of thedistribution date. If a fiduciary makes more than one distribution of assetsto beneficiaries to whom this section applies, each beneficiary, includingone who does not receive part of the distribution, is entitled, as of eachdistribution date, to the net income the fiduciary has received after thedate of death or terminating event or earlier distribution date but has notdistributed as of the current distribution date.
B. In determining a beneficiary's share of net income, the following rulesapply:
1. The beneficiary is entitled to receive a portion of the net income equalto the beneficiary's fractional interest in the undistributed principalassets immediately before the distribution date, including assets that latermay be sold to meet principal obligations.
2. The beneficiary's fractional interest in the undistributed principalassets must be calculated without regard to property specifically given to abeneficiary and property required to pay pecuniary amounts not in trust.
3. The beneficiary's fractional interest in the undistributed principalassets must be calculated on the basis of the aggregate value of those assetsas of the distribution date without reducing the value by any unpaidprincipal obligation.
4. The distribution date for purposes of this section may be the date as ofwhich the fiduciary calculates the value of the assets if that date isreasonably near the date on which assets are actually distributed.
C. If a fiduciary does not distribute all of the collected but undistributednet income to each person as of a distribution date, the fiduciary shallmaintain appropriate records showing the interest of each beneficiary in thatnet income.
D. A fiduciary may apply the rules in this section, to the extent that thefiduciary considers it appropriate, to net gain or loss realized after thedate of death or terminating event or earlier distribution date from thedisposition of a principal asset if this section applies to the income fromthe asset.
(1999, c. 975.)