[§557A-303]  Apportionment when income
interest ends.  (a)  As used in this section, "undistributed
income" means net income received before the date on which an income
interest ends.  The term does not include an item of income or expense that is
due or accrued or net income that has been added or is required to be added to
principal pursuant to the terms of the trust.



(b)  When a mandatory income interest ends, the
trustee shall pay to a mandatory income beneficiary who survives that date, or
the estate of a deceased mandatory income beneficiary whose death causes the
interest to end, the beneficiary's share of the undistributed income that is
not disposed of pursuant to the terms of the trust, unless the beneficiary has
an unqualified power to revoke more than five per cent of the trust immediately
before the income interest ends.  In the latter case, the undistributed income
from the portion of the trust that may be revoked shall be added to principal.



(c)  When a trustee's obligation to pay a fixed
annuity or a fixed fraction of the value of the trust's assets ends, the
trustee shall prorate the final payment if and to the extent required by
applicable law to accomplish a purpose of the trust or its settlor relating to
income, gift, estate, or other tax requirements. [L 2000, c 191, pt of §1]