N.Y. Estates, Powers & Trusts Law § 11-a-3.3: Apportionment when income interest ends

§ 11-A-3.3 Apportionment when income interest ends

(a) In this section, "undistributed income" means net income received

on or before the date on which an income interest ends. The term does

not include an item of income or expense that is due or accrued or net

income that has been added or 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 a

mandatory income beneficiary who survives that date, or the estate of a

deceased mandatory income beneficiary whose death causes the interest to

end, the beneficiary's share of the undistributed income that is not

disposed of under the terms of the trust unless the beneficiary has an

unqualified power to revoke more than five percent of the trust

immediately before the income interest ends. In the latter case, the

undistributed income from the portion of 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 of the value of the trust's assets ends, the trustee shall

prorate the final payment if and to the extent required by applicable

law to accomplish a purpose of the trust or its settlor relating to

income, gift, estate, or other tax requirements.