{"data":{"id":"us-ky/krs-386.484","jurisdiction":"us-ky","citation":"KRS 386.484","heading":"Receipts from minerals, water, and other natural resources.","body":"(1) To the extent that a trustee accounts for receipts from an interest in minerals or\nother natural resources pursuant to this section, the trustee shall allocate them as\nfollows:\n(a) If received as nominal delay rental or nominal annual rent on a lease, a re ceipt\nshall be allocated to income;\n(b) If received from a production payment, a receipt shall be allocated to income\nif and to the extent that the agreement creating the production payment\nprovides a factor for interest or its equivalent. The balance shal l be allocated\nto principal;\n(c) If an amount received as a royalty, shut -in-well payment, take -or-pay\npayment, bonus, or delay rental is more than nominal, ninety percent (90%)\nshall be allocated to principal and the balance to income; or\n(d) If an amount  is received from a working interest or any other interest not\nprovided for in paragraph (a), (b), or (c) of this subsection, ninety percent\n(90%) of the net amount received shall be allocated to principal and the\nbalance to income.\n(2) An amount received on account of an interest in water that is renewable shall be\nallocated to income. If the water is not renewable, ninety percent (90%) of the\namount shall be allocated to principal and the balance to income.\n(3) KRS 386.450 to 386.504 apply whether or not a decedent or donor was extracting\nminerals, water, or other natural resources before the interest became subject to the\ntrust.\n(4) If a trust owns an interest in minerals, water, or other natural resources on January\n1, 2005, the trustee may allocate rece ipts from the interest as provided in KRS\n386.450 to 386.504 or in the manner used by the trustee before January 1, 2005. If\nthe trust acquires an interest in minerals, water, or other natural resources after\nJanuary 1, 2005, the trustee shall allocate rec eipts from the interest as provided in\nKRS 386.450 to 386.504.\n(5) The proceeds from any disposition of an interest specified in this section shall be\nallocated in the same manner as receipts from the interest.","path":["KRS Chapter 386"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=35934","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:59:16Z","sha256":"38252f5798e167468c9a13306afab04a0c08fe33c872b87d91b9deab8019cc58","source_id":"us-ky","stale":false,"prev":"us-ky/krs-386.482","next":"us-ky/krs-386.486"},"notice":"GroundRules: Original legal text. Not legal advice."}