Distribution of net income to beneficiaries; rules for determining share of net income

1. Each beneficiary described in subsection 4 of NRS 164.800 is entitled to receive a portion of the net income equal to the beneficiary’s fractional interest in undistributed principal assets, using values as of the date of distribution. If a fiduciary makes more than one distribution of assets to beneficiaries to whom this section applies, each beneficiary, including one who does not receive part of the distribution, is entitled, as of each date of distribution, to the net income the fiduciary has received after the date of death or terminating event or earlier date of distribution but has not distributed as of the current date of distribution. 2. In determining a beneficiary’s share of net income, the following rules apply: (a) The beneficiary is entitled to receive a portion of the net income equal to the beneficiary’s fractional interest in the undistributed principal assets immediately before the date of distribution, including assets that later may be sold to meet principal obligations. (b) The beneficiary’s fractional interest in the undistributed principal assets must be calculated without regard to property specifically given to a beneficiary and property required to pay pecuniary amounts not in trust. (c) The beneficiary’s fractional interest in the undistributed principal assets must be calculated on the basis of the aggregate value of those assets as of the date of distribution without reducing the value by any unpaid principal obligation. (d) The date of distribution for purposes of this section may be the date as of which the fiduciary calculates the value of the assets if that date is reasonably near the date on which assets are actually distributed. 3. If a fiduciary does not distribute all the collected but undistributed net income to each person as of a date of distribution, the fiduciary shall maintain appropriate records showing the interest of each beneficiary in that net income. 4. A trustee may apply the rules in this section, to the extent that the trustee considers it appropriate, to net gain or loss realized after the date of death or terminating event or earlier date of distribution from the disposition of a principal asset if this section applies to the income from the asset.