§ 8165. Transfers from income to reimburse principal.

167 words·~1 min read·/pa/title-20/chapter-81/8165

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)Permissible reimbursements.-- A trustee may transfer an appropriate amount from income to principal in one or more accounting periods to reimburse principal or to provide a reserve for future disbursements if the trustee makes or expects to make a disbursement from principal which is allocable to income under section 8161 (relating to mandatory disbursements from income) or 8163 (relating to discretionary allocation of disbursements) and which:

(1)is paid from principal because it is unusually large; or

(2)is made to prepare property for rental, including tenant allowances, leasehold improvements and broker's commissions.

(b)Continued transfers.-- If the asset whose ownership gives rise to the disbursements becomes subject to a successive income interest after an income interest ends, a trustee may continue to transfer amounts from income to principal as provided in subsection (a).

(c)Application.-- This section shall not apply to the extent the trustee has been or expects to be reimbursed by a third party.

20c8166s