55-277.9 - Apportionment when income interest ends. - Virginia Statutes

§ 55-277.9. Apportionment when income interest ends.

A. In this section, "undistributed income" means net income received beforethe date on which an income interest ends. The term does not include an itemof income or expense that is due or accrued or net income that has been addedor is required to be added to principal under the terms of the trust.

B. When a mandatory income interest ends, the trustee shall pay to amandatory income beneficiary who survives that date, or the estate of adeceased mandatory income beneficiary whose death causes the interest to end,the beneficiary's share of the undistributed income that is not disposed ofunder the terms of the trust unless the beneficiary has an unqualified powerto revoke more than five percent of the trust immediately before the incomeinterest ends. In the latter case, the undistributed income from the portionof the trust that may be revoked must be added to principal.

C. When a trustee's obligation to pay a fixed annuity or a fixed fraction ofthe value of the trust's assets ends, the trustee shall prorate the finalpayment if and to the extent required by applicable law to accomplish apurpose of the trust or its settlor relating to income, gift, estate, orother tax requirements.

(1999, c. 975.)