_______________________________________________
HOUSE
BILL 1076
_______________________________________________
Passed
Legislature - 1993 Regular Session
State
of Washington 53rd Legislature 1993
Regular Session
By
Read
first time 01/13/93. Referred to Committee on Judiciary.
Allowing a personal representative with nonintervention powers to
determine time and manner of distributing income.
AN ACT Relating to the distribution of income
earned during administration of a decedent's estate; and amending RCW
11.104.050.
BE
IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1.
RCW 11.104.050 and 1985 c 30 s 88 are each amended to read as follows:
(1) Unless the will or the court otherwise
provides and subject to subsection (2) of this section, all expenses incurred
in connection with the settlement of a decedent's estate, including debts,
funeral expenses, estate taxes, interest due at death, and penalties concerning
taxes, family allowances, fees of attorneys and personal representatives, and
court costs shall be charged against the principal of the estate, except that
the principal shall be reimbursed from income for any increase in estate taxes
due to the use of administration expenses that were paid from principal as
deductions for income tax purposes.
(2) Unless the will or the court otherwise
provides, income from the assets of a decedent's estate after the death of the
testator and before distribution, including income from property used to
discharge liabilities, shall be determined in accordance with the rules
applicable to a trust under this chapter and distributed as follows:
(a) To beneficiaries of any specific bequest,
legacy, or devise, the income from the property bequeathed or devised to them
respectively, less taxes, ordinary repairs, and other expenses of management
and operation of the property, and appropriate portions of interest accrued
since the death of the testator and of taxes imposed on income (excluding taxes
on capital gains) which accrue during the period of administration;
(b) Subject to (c) of this subsection, to all
other beneficiaries, including trusts, the balance of the income less the
balance of taxes, ordinary repairs, and other expenses of management and
operation of all property from which the estate is entitled to income, plus the
balance of all income accrued since the death of the testator, and less the
balance of all taxes imposed on income (excluding taxes on capital gains) which
accrue during the period of administration, in proportion to their respective
interests in the undistributed assets of the estate computed at times of distribution
on the basis of the fair value, provided, that the amount of income earned
before the date or dates of payment of any estate or inheritance tax shall be
distributed to those beneficiaries in proportion to their interests immediately
before the making of those payments. A personal representative who has been
granted nonintervention powers under chapter 11.68 RCW may determine the time
and manner of distributing the income to a beneficiary entitled to receive the
income including:
(i) A residuary beneficiary; and
(ii) A testamentary trust beneficiary to
whom trust income must be distributed or, if the trustee named in the will
approves or ratifies the distribution, to whom trust income may be distributed;
and
(c) Pecuniary bequests not in trust do not
receive income, and, subject to the provisions of RCW 11.56.160, all such
bequests, including those to the decedent's surviving spouse, are not allocated
any share of the expenses identified in subsection (2)(b) of this section.
(3) Any income with respect to which the income
taxes have been paid which is payable in whole or in part to one or more
charitable or other tax exempt organizations, and for which an income tax
charitable deduction was allowable, shall be allocated among the distributees
in such manner that the diminution in such taxes resulting from the charitable
deduction allowable will inure to the benefit of the charitable or tax exempt
organization giving rise to the deduction.
(4) Income received by a trustee under
subsection (2) of this section shall be treated as income of the trust.
