Subdivision 1. Allocation of receipts. (a) If a part of the principal consists of a right to receive royalties, overriding or limited royalties, working interests, production payments, net profit interests, or other interests in minerals or other natural resources in, on, or under land, the receipts from taking the natural resources from the land must be allocated under paragraphs (b) to (d).
(b) If received as rent on a lease or extension payments on a lease, the receipts are income.
(c) If received from a production payment carved out of a mineral property, the receipts are income to the extent of a factor for interest or its equivalent provided in the governing instrument or a greater amount determined by the trustee to be reasonable and equitable in view of the interests of those entitled to income as well as those entitled to principal. The receipts not allocated to income are principal.
(d) If received as a royalty, overriding or limited royalty, or bonus or from a working, net profit, or other interest in minerals or other natural resources, receipts not provided for in paragraph (b) or (c) must be apportioned on a yearly basis in accordance with this paragraph whether or not any natural resource was being taken from the land at the time the trust was established. The receipts from these properties must be allocated in accordance with what is reasonable and equitable in view of the interests of those entitled to income as well as of those entitled to principal. The amount allocated to principal must be presumed to be reasonable and equitable if it is neither substantially more nor less than the amount allowable as a deduction for depletion, amortization, depreciation, or similar costs under the Internal Revenue Code of 1986. Any allocated amount must be added to principal as an allowance for depletion of the asset. The balance of the gross receipts, after payment from the receipts of all direct and indirect expenses, is income.
Subd. 2. Timber excepted. This section does not apply to timber.
2015 c 5 art 11 s 9
Structure Minnesota Statutes
Chapters 500 - 515B — Property And Property Interests
Section 501C.0101 — Short Title.
Section 501C.0103 — Definitions.
Section 501C.0104 — Knowledge.
Section 501C.0105 — Default And Mandatory Rules.
Section 501C.0106 — Common Law Of Trusts; Principles Of Equity.
Section 501C.0107 — Governing Law.
Section 501C.0108 — Principal Place Of Administration.
Section 501C.0109 — Methods And Waiver Of Nonjudicial Notice.
Section 501C.0110 — Others Treated As Qualified Beneficiaries.
Section 501C.0111 — Nonjudicial Settlement Agreements.
Section 501C.0112 — Rules Of Construction.
Section 501C.0201 — Role Of Court In Administration Of Trust And Nature Of Judicial Proceeding.
Section 501C.0202 — Subject Matter Of Judicial Proceedings.
Section 501C.0203 — Order For Hearing And Notice.
Section 501C.0204 — Order And Appeal.
Section 501C.0205 — Court-supervised Trusts.
Section 501C.0206 — Personal Jurisdiction Over Trustee And Beneficiary.
Section 501C.0208 — Application.
Section 501C.0301 — Representation: Basic Effect.
Section 501C.0302 — Representation By Holder Of A General Power.
Section 501C.0303 — Representation By Fiduciaries And Parents.
Section 501C.0304 — Representation By Person Having Substantially Identical Interest.
Section 501C.0305 — Representation By Court; Appointment Of Representative.
Section 501C.0401 — Methods Of Creating Trust.
Section 501C.0402 — Requirements For Creation.
Section 501C.0403 — Trusts Created In Other Jurisdictions.
Section 501C.0404 — Trust Purposes.
Section 501C.0406 — Creation Of Trust Induced By Fraud, Duress, Or Undue Influence.
Section 501C.0407 — Evidence Of Oral Trust.
Section 501C.0408 — Trust For Care Of Animal.
Section 501C.0409 — Noncharitable Trust Without Ascertainable Beneficiary.
Section 501C.0410 — Modification Or Termination Of Trust; Proceedings For Approval Or Disapproval.
Section 501C.0411 — Modification Or Termination Of Noncharitable Irrevocable Trust By Consent.
Section 501C.0414 — Modification Or Termination Of Uneconomic Trust.
Section 501C.0415 — Reformation To Correct Mistakes.
Section 501C.0416 — Modification To Achieve Settlor's Tax Objectives.
Section 501C.0417 — Combination And Division Of Trusts.
Section 501C.0502 — Spendthrift Provision.
Section 501C.0504 — Right To Compel Distribution.
Section 501C.0505 — Creditor's Claim Against Settlor.
Section 501C.0506 — Overdue Distribution.
Section 501C.0507 — Personal Obligations Of Trustee.
Section 501C.0601 — Capacity Of Settlor Of Revocable Trust.
Section 501C.0602 — Revocation Or Amendment Of Revocable Trust.
Section 501C.0603 — Written Statement Regarding Tangible Personal Property.
Section 501C.0604 — Settlor's Powers.
Section 501C.0701 — Accepting Or Declining Trusteeship.
Section 501C.0702 — Trustee's Bond.
Section 501C.0703 — Cotrustees.
Section 501C.0704 — Vacancy In Trusteeship; Appointment Of Successor.
Section 501C.0705 — Resignation Of Trustee.
Section 501C.0706 — Removal Of Trustee.
Section 501C.0707 — Delivery Of Property By Former Trustee.
Section 501C.0708 — Compensation Of Trustee.
Section 501C.0709 — Reimbursement Of Expenses.
Section 501C.0801 — Duty To Administer Trust.
Section 501C.0802 — Duty Of Loyalty.
Section 501C.0803 — Impartiality.
Section 501C.0804 — Prudent Administration.
Section 501C.0807 — Delegation By Trustee.
Section 501C.0808 — Directed Trusts.
Section 501C.0809 — Control, Protection, And Delivery Of Trust Property.
Section 501C.0810 — Record Keeping And Identification Of Trust Property.
Section 501C.0811 — Enforcement And Defense Of Claims.
Section 501C.0813 — Duty To Inform And Report.
Section 501C.0814 — Discretionary Powers; Tax Savings.
Section 501C.0815 — General Powers Of Trustee.
Section 501C.0816 — Specific Powers Of Trustee.
Section 501C.0817 — Distribution Upon Termination.
Section 501C.0901 — Investment And Management Of Trust Assets.
Section 501C.1001 — Remedies For Breach Of Trust.
Section 501C.1002 — Damages For Breach Of Trust.
Section 501C.1003 — Remedies In Absence Of Breach.
Section 501C.1004 — Attorney Fees And Costs.
Section 501C.1005 — Limitation Of Action Against Trustee.
Section 501C.1006 — Reliance On Trust Instrument.
Section 501C.1007 — Event Affecting Administration Or Distribution.
Section 501C.1008 — Exculpation Of Trustee.
Section 501C.1009 — Beneficiary's Consent, Release, Or Ratification.
Section 501C.1010 — Limitation On Personal Liability Of Trustee.
Section 501C.1011 — Interest As General Partner.
Section 501C.1012 — Protection Of Person Dealing With Trustee.
Section 501C.1013 — Certificate Of Trust.
Section 501C.1014 — Affidavit Of Trustee In Real Property Transactions.
Section 501C.1101 — Definitions.
Section 501C.1102 — Duty Of Trustee As To Receipts And Expenditure.
Section 501C.1103 — Income; Principal; Charges.
Section 501C.1104 — When Right To Income Arises; Apportionment Of Income.
Section 501C.1105 — Income Earned During Administration Of A Decedent's Estate.
Section 501C.1106 — Entity Distributions.
Section 501C.1107 — Bond Premium And Discount.
Section 501C.1108 — Sole Proprietorships.
Section 501C.1109 — Disposition Of Natural Resources.
Section 501C.1112 — Trustee's Power To Adjust.
Section 501C.1113 — Charges Against Income And Principal.
Section 501C.1114 — Nontrust Estates.
Section 501C.1115 — Application.
Section 501C.1116 — Ascertainment Of Income Or Principal.
Section 501C.1117 — Uniformity Of Interpretation.
Section 501C.1118 — Short Title.
Section 501C.1201 — Memorial Fund.
Section 501C.1202 — Suspension Of The Power Of Alienation.
Section 501C.1203 — Trusts Forming Part Of Retirement Plans For Participating Members.
Section 501C.1204 — Trusts Not Affected.
Section 501C.1207 — Effect Of Dissolution Of Marriage.
Section 501C.1208 — Settlor And Agents Of Settlor.
Section 501C.1301 — Uniformity Of Application And Construction.
Section 501C.1302 — Electronic Records And Signatures.