Code of Virginia
Chapter 10.1 - Uniform Fiduciary Income and Principal Act
§ 64.2-1036. Fiduciary duties; general principles

A. In making an allocation or determination or exercising discretion under this chapter, a fiduciary shall:
1. Act in good faith, based on what is fair and reasonable to all beneficiaries;
2. Administer a trust or estate impartially, except to the extent the terms of the trust manifest an intent that the fiduciary shall or may favor one or more beneficiaries;
3. Administer the trust or estate in accordance with the terms of the trust, even if there is a different provision in this chapter; and
4. Administer the trust or estate in accordance with this chapter, except to the extent the terms of the trust provide otherwise or authorize the fiduciary to determine otherwise.
B. A fiduciary's allocation, determination, or exercise of discretion under this chapter is presumed to be fair and reasonable to all beneficiaries. A fiduciary may exercise a discretionary power of administration given to the fiduciary by the terms of the trust, and an exercise of the power that produces a result different from a result required or permitted by this chapter does not create an inference that the fiduciary abused the fiduciary's discretion.
C. A fiduciary shall:
1. Add a receipt to principal, to the extent neither the terms of the trust nor this chapter allocates the receipt between income and principal; and
2. Charge a disbursement to principal, to the extent neither the terms of the trust nor this chapter allocates the disbursement between income and principal.
D. A fiduciary may exercise the power to adjust under § 64.2-1038, convert an income trust to a unitrust under subdivision A 1 of § 64.2-1041, change the percentage or method used to calculate a unitrust amount under subdivision A 2 of § 64.2-1041, or convert a unitrust to an income trust under subdivision A 3 of § 64.2-1041 if the fiduciary determines the exercise of the power will assist the fiduciary to administer the trust or estate impartially.
E. Factors the fiduciary must consider in making the determination under subsection D include:
1. The terms of the trust;
2. The nature, distribution standards, and expected duration of the trust;
3. The effect of the allocation rules, including specific adjustments between income and principal, under Articles 4 (§ 64.2-1048 et seq.) through 9 (§ 64.2-1073 et seq.);
4. The desirability of liquidity and regularity of income;
5. The desirability of the preservation and appreciation of principal;
6. The extent to which an asset is used or may be used by a beneficiary;
7. The increase or decrease in the value of principal assets, reasonably determined by the fiduciary;
8. Whether and to what extent the terms of the trust give the fiduciary power to accumulate income or invade principal or prohibit the fiduciary from accumulating income or invading principal;
9. The extent to which the fiduciary has accumulated income or invaded principal in preceding accounting periods;
10. The effect of current and reasonably expected economic conditions; and
11. The reasonably expected tax consequences of the exercise of the power.
2022, c. 354.

Structure Code of Virginia

Code of Virginia

Title 64.2 - Wills, Trusts, and Fiduciaries

Chapter 10.1 - Uniform Fiduciary Income and Principal Act

§ 64.2-1033. Definitions

§ 64.2-1034. Scope

§ 64.2-1035. Governing law

§ 64.2-1036. Fiduciary duties; general principles

§ 64.2-1037. Judicial review of exercise of discretionary power; request for instruction

§ 64.2-1038. Fiduciary's power to adjust

§ 64.2-1039. Definitions

§ 64.2-1040. Application; duties and remedies

§ 64.2-1041. Authority of fiduciary

§ 64.2-1042. Notice

§ 64.2-1043. Unitrust policy

§ 64.2-1044. Unitrust rate

§ 64.2-1045. Applicable value

§ 64.2-1046. Period

§ 64.2-1047. Special tax benefits; other rules

§ 64.2-1048. Character of receipts from entity

§ 64.2-1049. Distribution from trust or estate

§ 64.2-1050. Business or other activity conducted by fiduciary

§ 64.2-1051. Principal receipts

§ 64.2-1052. Rental property

§ 64.2-1053. Receipt on obligation to be paid in money

§ 64.2-1054. Insurance policy or contract

§ 64.2-1055. Insubstantial allocation not required

§ 64.2-1056. Deferred compensation, annuity, or similar payment

§ 64.2-1057. Liquidating asset

§ 64.2-1058. Minerals, water, and other natural resources

§ 64.2-1059. Timber

§ 64.2-1060. Marital deduction property not productive of income

§ 64.2-1061. Derivative or option

§ 64.2-1062. Asset-backed security

§ 64.2-1063. Other financial instrument or arrangement

§ 64.2-1064. Disbursement from income

§ 64.2-1065. Disbursement from principal

§ 64.2-1066. Transfer from income to principal for depreciation

§ 64.2-1067. Reimbursement of income from principal

§ 64.2-1068. Reimbursement of principal from income

§ 64.2-1069. Income taxes

§ 64.2-1070. Adjustment between income and principal because of taxes

§ 64.2-1071. Determination and distribution of net income

§ 64.2-1072. Distribution to successor beneficiary

§ 64.2-1073. When right to income begins and ends

§ 64.2-1074. Apportionment of receipts and disbursements when decedent dies or income interest begins

§ 64.2-1075. Apportionment when income interest ends

§ 64.2-1076. Uniformity of application and construction

§ 64.2-1077. Relation to Electronic Signatures in Global and National Commerce Act

§ 64.2-1078. Application to trust or estate