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Trusts & Estates Glossary: D

DEAD HAND:
A term used to indicate the continuing hold of a settlor or a testator, who has been dead for many years, upon living individuals or organizations that are confronted with conditions which the settlor or the testator could not have foreseen. See also Statutes of Mortmain.

DEATH TAXES:
Taxes imposed on property or on the transfer of property at the owner’s death; a general term including estate taxes, inheritance taxes, and all succession or transfer taxes associated with the death of the owner of the property. Sometimes called death duties.

DEBENTURE:
An obligation that is not secured by a specific lien on property, as an unsecured note of a corporation.

DECLARATION DATE:
The date on which the directors of a corporation authorize the payment of a dividend; to be distinguished from the date of payment of the dividend.

DECLARATION OF TRUST:
An acknowledgement, usually but not necessarily in writing, by one holding or taking title to property, that he holds the property in trust for the benefit of someone else.

DECLARATORY JUDGMENT:
The judgment or decision of a court interpreting an instrument or declaring what the law on the given matter is under a statutory proceeding that authorizes the court to enter such a judgment in a case that is not being litigated.

DEPENDENT:
A person who is dependent for support upon another; to be distinguished from one who merely derives a benefit from the earnings of another.

DEPLETION:
The consumption or exhaustion of wasting property—such as royalties, patent rights, mines, oil and gas wells, quarries, timberlands, and other things that are consumed or worn out in the using.

DEPOSITARY:
One who receives a deposit of money, securities, instruments, or other property; to be distinguished from depository, which is the place of deposit.

DEPOSITION:
The written testimony of a witness, under oath, before a qualified officer, to be used in place of the oral testimony of the witness at a trial or other hearing, such as the deposition of a nonresident subscribing witness to a Will.

DEPOSITORY:
A place where something is deposited, such as a safe deposit vault. See also Securities Depository.

DESCENDANT:
One who is descended in a direct line from another, however remotely (child, grandchild, great-grand

DESCENT:
The passing of real property by inheritance. See also Devolution.

DEVISE:
A gift of real property by Will; to be distinguished from bequest.

DEVOLUTION:
The passing of property by inheritance; a general term that includes both descent of real property and distribution of personal property.

DICKMAN GIFT:
A gift made by an owner of property by permitting that property to benefit or be used by another without exacting rent or interest. The case of Dickman v. Commissioner first ruled that a Crown loan resulted in a taxable gift by the lender of the amount of interest foregone on the loan. The Internal Revenue Service often employs the logic of that case to imply a gift in other situations where the owner of property forgoes its profitable use or benefit.

DIRECT HEIR:
A person in the direct line of ascent or descent of the decedent; as, father, mother, son, daughter. See also Collateral Heir; Heir.

DIRECT SKIP:
An outright generation-skipping transfer, either by gift or at death, to a recipient, known as a "skip person," who is two or more generation levels below the transferor. A direct skip also occurs upon a transfer by gift or at death to a trust, all of the beneficiaries of which are skip persons.

DISTRIBUTABLE NET INCOME ("DNI"):
All income generated by a trust, less all deductible expenses paid by a trust whether charged against principal or income.

DISTRIBUTEE:
A person to whom something is distributed; frequently applied to the recipient of personal property under intestacy and known as next of kin; to be distinguished from heir— a person who inherits real property.

DISTRIBUTION:
The apportionment of personal property (or its proceeds) among those entitled to receive the property according to the applicable statute of distribution or under the terms of the Will or trust agreement; to be distinguished from disbursement.

DISTRIBUTION IN KIND:
The distribution of the property itself; to be distinguished from the conversion of the property into cash and the distribution of the proceeds of such conversion.

DISTRIBUTIVE SHARE:
The share of a person in the distribution of an estate.

DIVERSIFICATION:
The process of spreading the investment of a fund both as to type of securities and as to industries.

DIVEST:
To annul or take away a vested right.

DIVIDEND:
A distribution of cash, securities, or other valuables made by a corporation to its stockholders in proportion to the respective number of shares owned by them.

DIVIDEND REINVESTMENT PLAN:
A plan in which dividends paid to a shareholder are reinvested in shares of the company through an agent for the shareholders, normally a bank.

DNAMTI:
Distributable Net Alternative Minimum Taxable Income. A concept used to compute the amount of alternative minimum taxable income that passes from a trust to its beneficiaries.

DOMICILE:
The place which a person regards as his permanent home and principal establishment; the place to which, whenever he is absent, he has the intention of returning. A person’s domicile may or may not be the same as his residence at a given time.

DOMICILIARY ADMINISTRATION:
The settlement of that portion of a decedent’s estate which is located in the state of his domicile; to be distinguished from ancillary administration which relates to property elsewhere than in the state of the decedent’s domicile.

DOMICILIARY TRUSTEE:
The trustee of that portion of a decedent’s or settlor’s property which is located in the state of his domicile; to be distinguished from ancillary trustee that administers property elsewhere than in the state of the decedent’s or settlor’s domicile.

DURABLE POWER OF ATTORNEY:
A Power of Attorney which remains effective despite the disability or incompetence of the person granting the power. Typically, a person will give such a Power of Attorney providing that it becomes exercisable only upon his disability or incompetence.

DURESS:
Compulsion or constraint by force or fear of personal violence, prosecution, or imprisonment which induces a person to do what he does not want to do or to refrain from doing something he has a legal right to do. Sometimes the word is used with reference to the making of a Will, as that it was made under duress.