Texas Property Code

§ 116.175 — TIMBER

PR § 116.175Title 9. TRUSTS · Part B. TEXAS TRUST CODE: CREATION, OPERATION, AND TERMINATION OF TRUSTS · Ch. 116. UNIFORM PRINCIPAL AND INCOME ACT · Art. D. ALLOCATION OF RECEIPTS DURING ADMINISTRATION OF TRUST

Statute text

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(a)To the extent that a trustee accounts for receipts from the sale of timber and related products pursuant to this section, the trustee shall allocate the net receipts:

(1)to income to the extent that the amount of timber removed from the land does not exceed the rate of growth of the timber during the accounting periods in which a beneficiary has a mandatory income interest;

(2)to principal to the extent that the amount of timber removed from the land exceeds the rate of growth of the timber or the net receipts are from the sale of standing timber;

(3)to or between income and principal if the net receipts are from the lease of timberland or from a contract to cut timber from land owned by a trust, by determining the amount of timber removed from the land under the lease or contract and applying the rules in Subdivisions (1) and (2); or

(4)to principal to the extent that advance payments, bonuses, and other payments are not allocated pursuant to Subdivision (1), (2), or (3).

(b)In determining net receipts to be allocated pursuant to Subsection (a), a trustee shall deduct and transfer to principal a reasonable amount for depletion.

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Legislative history

Added by Acts 2003, 78th Leg., ch. 659, Sec. 1, eff. Jan. 1, 2004.