58-9-201. Determination and distribution of net income.
58-9-201
58-9-201. Determination and distribution of netincome.After a decedent dies, in the case of an estate, or after anincomeinterest in a trust ends, the following rules apply:
(1) A fiduciary of an estate or of a terminating income interest shalldetermine the amount of net income and net principal receipts received fromproperty specifically given to a beneficiary under the rules in parts 3through 5which apply to trustees and the rules in subsection (5). The fiduciary shalldistributethe net income and net principal receipts to the beneficiary who is to receivethespecific property.
(2) A fiduciary shall determine the remaining net income of adecedent'sestate or a terminating income interest under the rules in parts 3 through5which apply to trustees and by:
(A) including in net income all income from property used to dischargeliabilities;
(B) paying from income or principal, in the fiduciary’s discretion,feesof attorneys, accountants, and fiduciaries; court costs and other expenses ofadministration; and interest on death taxes, but the fiduciary may pay thoseexpenses from income of property passing to a trust for which the fiduciaryclaimsan estate tax marital or charitable deduction only to the extent that thepayment of those expenses from income will not cause the reduction or loss ofthe deduction;and
(C) paying from principal all other disbursements made or incurred inconnection with the settlement of a decedent's estate or the winding upof aterminating income interest, including debts, funeral expenses, disposition ofremains, family allowances, and death taxes and related penalties that areapportioned to the estate or terminating income interest by the will, the termsof thetrust, or applicable law.
(3) A fiduciary shall distribute to a beneficiary who receives a pecuniaryamount outright the interest or any other amount provided by the will, theterms ofthe trust, or applicable law from net income determined under subsection (2) orfrom principal to the extent that net income is insufficient. If a beneficiaryis toreceive a pecuniary amount outright from a trust after an income interest endsandno interest or other amount is provided for by the terms of the trust orapplicablelaw, the fiduciary shall distribute the interest or other amount to which thebeneficiary would be entitled under applicable law if the pecuniary amount wererequired to be paid under a will.
(4) A fiduciary shall distribute the net income remaining after distributionsrequired by subsection (3) in the manner described inK.S.A. 58-9-202, andamendmentsthereto, to all otherbeneficiaries, including a beneficiary who receives a pecuniary amount intrust,even if the beneficiary holds an unqualified power to withdraw assets from thetrustor other presently exercisable general power of appointment over the trust.
(5) A fiduciary may not reduce principal or income receipts from propertydescribed in subsection (1) because of a payment described inK.S.A. 58-9-501or 58-9-502,and amendments thereto, tothe extent that the will, the terms of the trust, or applicable law requiresthefiduciary to make the payment from assets other than the property or to theextentthat the fiduciary recovers or expects to recover the payment from a thirdparty.The net income and principal receipts from the property are determined byincluding all of the amounts the fiduciary receives or pays with respect to theproperty, whether those amounts accrued or became due before, on, or after thedateof a decedent's death or an income interest's terminating event,and by making areasonable provision for amounts that the fiduciary believes the estate orterminating income interest may become obligated to pay after the property isdistributed.
History: L. 2000, ch. 61, § 5; July 1.