Pennsylvania Consolidated & Unconsolidated Statutes
Chapter 81 - Principal and Income
Section 8151 - Minerals, water and other natural resources

(a) Allocation for receipts from minerals and other natural resources.--To the extent that a trustee accounts for receipts from an interest in minerals or other natural resources under this section, the trustee shall allocate them as follows:
(1) If received as nominal delay rental or nominal annual rent on a lease, a receipt shall be allocated to income.
(2) If received from a production payment, a receipt shall be allocated to income if and to the extent that the agreement creating the production payment provides a factor for interest or its equivalent. The balance shall be allocated to principal.
(3) If an amount received as a royalty, shut-in-well payment, take-or-pay payment, bonus or delay rental is more than nominal:
(i) sixty-six and two-thirds percent shall be allocated to principal; and
(ii) the balance shall be allocated to income.
(4) If an amount is received from a working interest or any other interest not provided for in paragraph (1), (2) or (3):
(i) sixty-six and two-thirds percent of the net amount received shall be allocated to principal; and
(ii) the balance shall be allocated to income.
(b) Allocation for receipts from water.--
(1) An amount received on account of an interest in renewable water shall be allocated to income.
(2) An amount received on account of an interest in nonrenewable water shall be allocated as follows:
(i) Sixty-six and two-thirds percent of the amount shall be allocated to principal.
(ii) The balance shall be allocated to income.
(c) Application.--This chapter applies whether or not a decedent or donor was extracting minerals, water or other natural resources before the interest became subject to the trust.

Cross References. Section 8151 is referred to in sections 8121, 8144, 8146, 8148, 8150 of this title.