Vermont § 3372 - Disbursements from principal

§ 3372. Disbursements from principal

• (a) A trustee shall make the following disbursements from principal: (1) the remaining one-half of the disbursements described in subdivisions 3371(1) and
  (2) of this title; (2) all of the trustee’s compensation calculated on principal as a fee for acceptance,
  distribution, or termination, and disbursements made to prepare property for sale; (3) payments on the principal of a trust debt; (4) expenses that extend the life of trust property or that change the form of principal
  to an improvement or accretion to another item of trust property; (5) expenses of a proceeding that concerns primarily principal, including a proceeding
  to construe the trust or to protect the trust or its property; (6) premiums paid on a policy of insurance not described in subdivision 3371(4) of this title of which the trust is the owner and beneficiary; (7) estate, inheritance, and other transfer taxes, including penalties, apportioned to
  the trust; and (8) disbursements related to environmental matters, including reclamation, assessing environmental
  conditions, remedying and removing environmental contamination, monitoring remedial
  activities and the release of substances, preventing future releases of substances,
  collecting amounts from persons liable or potentially liable for the costs of those
  activities, penalties imposed under environmental laws or regulations and other payments
  made to comply with those laws or regulations, statutory or common law claims by third
  parties, and defending claims based on environmental matters. (b) If a principal asset is encumbered with an obligation that requires income from that
  asset to be paid directly to the creditor, the trustee shall transfer from principal
  to income an amount equal to the income paid to the creditor in reduction of the principal
  balance of the obligation. (Added 2011, No. 114 (Adj. Sess.), § 1.)