Preferred beneficiaries are beneficiaries who are entitled to beneficial interest and any unpaid dividend, before any amount is distributed to the common beneficiaries.
Preferred beneficiaries will be entitled to receive out of the net earnings of the estate a fixed dividend, before any dividend can be paid or credited to any holder of Common Units of beneficial interest in an estate. [Tulsa Mortg. Inv. Co. v. Commissioner, 21 B.T.A. 735 (B.T.A. 1930)].