New Jersey § 3b:19b-5

§ 3b:19b-5.

After a decedent dies, in the case of an estate or after an income interest in a trust

ends, the following rules apply: a. A fiduciary of an estate or of a terminating income interest shall determine the

amount of net income and net principal receipts received from property specifically

devised to a beneficiary under the rules in sections 7 through 28 of this act which

apply to trustees and the rules in subsection e. of this section. The fiduciary shall distribute the net income and net principal receipts to the

beneficiary who is to receive the specific property. b. A fiduciary shall determine the remaining net income of a decedent's estate or

a terminating income interest under the rules in sections 7 through 28 of this act

which apply to trustees and by: (1) including in net income all income from property used to discharge liabilities;

and (2) paying from principal all disbursements made or incurred in connection with the

settlement of a decedent's estate or the winding up of a terminating income interest,

expenses of administration, including fees of attorneys, accountants and fiduciaries,

court costs, debts, funeral expenses, disposition of remains, family allowances and

death taxes and related penalties that are apportioned to the estate or terminating

income interest by the will, the terms of the trust or applicable law. c. A fiduciary shall distribute to a beneficiary who receives a pecuniary amount outright

the interest or any other amount provided by the will, the terms of the trust or applicable

law from net income determined under subsection b. of this section or from principal

to the extent that net income is insufficient. If a beneficiary is to receive a pecuniary amount outright from a trust after an

income interest ends and no interest or other amount is provided for by the terms

of the trust or applicable law, the fiduciary shall distribute the interest or other

amount to which the beneficiary would be entitled under applicable law if the pecuniary

amount were required to be paid under a will. d. A fiduciary shall distribute the net income remaining after distributions required

by subsection c. of this section in the manner described in section 6 of this act

to all other beneficiaries, excluding a beneficiary who receives a pecuniary amount

outright or in trust. e. A fiduciary shall not reduce principal or income receipts from property described

in subsection a. of this section because of a payment described in section 24 or 25

of this act to the extent that the will, the terms of the trust, or applicable law

requires the fiduciary to make the payment from assets other than the property or

to the extent that the fiduciary recovers or expects to recover the payment from a

third party. The net income and principal receipts from the property are determined by including

all of the amounts the fiduciary receives or pays with respect to the property, whether

those amounts accrued or became due before, on or after the date of a decedent's death

or an income interest's terminating event, and by making a reasonable provision for

amounts that the fiduciary believes the estate or terminating income interest may

become obligated to pay after the property is distributed.