A.R.S. § 14-7427: Transfers from income to principal for depreciation; definition

A. A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation but may not transfer any amount for depreciation:

1. Of that portion of real property used or available for use by a beneficiary as a residence or of tangible personal property held or made available for the personal use or enjoyment of a beneficiary.

2. During the administration of a decedent's estate.

3. Under this section if the trustee is accounting under section 14-7412 for the business or activity in which the asset is used.

B. An amount transferred to principal need not be held as a separate fund.

C. For the purposes of this section, "depreciation" means a reduction in value due to wear, tear, decay, corrosion or gradual obsolescence of a fixed asset having a useful life of more than one year.