Tex. Codes » Property Code · TITLE 9. TRUSTS · SUBTITLE B. TEXAS TRUST CODE: CREATION, OPERATION, AND TERMINATION OF TRUSTS · CHAPTER 116. UNIFORM PRINCIPAL AND INCOME ACT
Texas Codes

Tex. Prop. Code § 116.161 (2026)

Principal Receipts

✓ current as of May 2026
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Sec. 116.161. PRINCIPAL RECEIPTS. A trustee shall allocate to principal:

(1) to the extent not allocated to income under this chapter, assets received from a transferor during the transferor's lifetime, a decedent's estate, a trust with a terminating income interest, or a payer under a contract naming the trust or its trustee as beneficiary;

(2) money or other property received from the sale, exchange, liquidation, or change in form of a principal asset, including realized profit, subject to this subchapter;

(3) amounts recovered from third parties to reimburse the trust because of disbursements described in Section 116.202(a)(7) or for other reasons to the extent not based on the loss of income;

(4) proceeds of property taken by eminent domain, but a separate award made for the loss of income with respect to an accounting period during which a current income beneficiary had a mandatory income interest is income;

(5) net income received in an accounting period during which there is no beneficiary to whom a trustee may or must distribute income; and

(6) other receipts as provided in Part 3.

Added by Acts 2003, 78th Leg., ch. 659, Sec. 1, eff. Jan. 1, 2004.

Notes of Decisions
Cited in 3 cases (2 in the last 5 years), 2013–2023 · leading case: Est. of Larkin Anson Jones, 422 S.W.3d 775 (Tex. App. 2013).
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Est. of Larkin Anson Jones, 422 S.W.3d 775 (Tex. App. 2013). “Tex. Prop.Code Ann. § 116.161(2) (West 2007).”
in Re the John O. Yates Trust v. . (Tex. App. 2022). · cites it 2× “6 TEX. PROP. CODE § 116.161(2). Robert’s argument that the sale proceeds must be treated as income and not principal is based on article IX(m), paragraph one of the will, which states in relevant part: “Although my estate consists primarily of mineral interests which should not…”
Frank Ahlgren III & the Copernican, LLC v. Frank Ahlgren Jr. & Elise Leake, as Co-Trs. of the Ahlgren Mgmt. Trust (Tex. App. 2023). “Appellants cite Paco’s testimony that he only held gold for his daughter. Appellants state that there was no contrary evidence.”
Tex. Prop. Code § 116.161(2): 3 cases
Est. of Larkin Anson Jones, 422 S.W.3d 775 (Tex. App. 2013). “Tex. Prop.Code Ann. § 116.161(2) (West 2007).”
in Re the John O. Yates Trust v. . (Tex. App. 2022). “6 TEX. PROP. CODE § 116.161(2). Robert’s argument that the sale proceeds must be treated as income and not principal is based on article IX(m), paragraph one of the will, which states in relevant part: “Although my estate consists primarily of mineral interests which should not…”
Frank Ahlgren III & the Copernican, LLC v. Frank Ahlgren Jr. & Elise Leake, as Co-Trs. of the Ahlgren Mgmt. Trust (Tex. App. 2023). “Appellants cite Paco’s testimony that he only held gold for his daughter. Appellants state that there was no contrary evidence.”
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