HRS §557A-503
Moving money from income to principal for depreciation
This section lets a trustee set aside some income from an asset to cover its loss in value over time, but only in certain cases. It cannot be done for property a beneficiary lives in or uses personally, during estate administration, or if the trustee already accounts for the asset under a different rule. The set-aside money does not need its own separate account.
trustees
The statute, as written — Transfers from income to principal for depreciation
(a) As used in this section, "depreciation" means a reduction in value of a fixed asset having a useful life of more than one year, due to wear, tear, decay, corrosion, or gradual obsolescence. (b) A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation, but a transfer may not be made 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; or (3) Under this section if the trustee is accounting under section 557A-403 for the business or activity in which the asset is used. (c) An amount transferred to principal need not be held as a separate fund.
Sections this one refers to
§557A-403 Trustee can keep separate books for a business
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