The Florida Senate

738.602  Deferred compensation, annuities, and similar payments.--

(1)  For purposes of this section, "payment" means a payment that a trustee may receive over a fixed number of years or during the life of one or more individuals because of services rendered or property transferred to the payor in exchange for future payments. The term includes a payment made in money or property from the payor's general assets or from a separate fund created by the payor, including a private or commercial annuity, an individual retirement account, and a pension, profit-sharing, stock-bonus, or stock-ownership plan.

(2)  With respect to payments that may be characterized as interest, dividends, or their equivalent:

(a)  A trustee shall allocate to income in the following order:

1.  First, payments characterized by the payor as interest or dividends or as a payment made in lieu of interest or dividends.

2.  Second, all other payments to the extent that the trustee, reasonably and in good faith, determines that such payments represent interest, dividends, or their equivalent.

(b)  A trustee shall allocate to principal the balance of any payment not characterized as, or otherwise determined to be, interest, dividends, or their equivalent.

(3)  If no part of a payment is characterized as, or otherwise determined to be, interest, a dividend, or an equivalent payment and all or part of the payment is required to be made, a trustee shall allocate to income 10 percent of the part that is required to be made during the accounting period and the balance to principal. If no part of a payment is required to be made or the payment received is the entire amount to which the trustee is entitled, the trustee shall allocate the entire payment to principal. For purposes of this subsection, a payment is not "required to be made" to the extent the payment is made because the trustee exercises a right of withdrawal.

(4)  If, to obtain an estate tax marital deduction for a trust, a trustee must allocate more of a payment to income than provided for by this section, the trustee shall allocate to income the additional amount necessary to obtain the marital deduction.

(5)  This section does not apply to payments to which s. 738.603 applies.

History.--s. 1, ch. 2002-42.