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SF571 (Legislative Session 94 (2025-2026))

Uniform Trust Code, Powers of Appointment, and the Uniform Probate Code various provisions modified; and technical, clarifying, and conforming changes made.

Related bill: HF360

AI Generated Summary

Purpose of the Bill

This bill aims to modify certain provisions of the Uniform Trust Code, Powers of Appointment, and the Uniform Probate Code. The goal is to update, clarify, and make conforming changes to Minnesota’s trust and probate laws to improve their functionality and applicability.

Main Provisions

  • Nonvested Property Interests: Defines conditions under which nonvested property interests and powers of appointment are valid or invalid, and extends the period of vesting to 500 years for new trusts unless a shorter period is specified.
  • Trust Modification and Termination: Allows modification or termination of noncharitable irrevocable trusts with consent from settlors and all beneficiaries, even if contrary to the trust's original purpose. Trusts can also be terminated if their value is deemed insufficient for the costs of administration.
  • Revocable Trusts: Clarifies the conditions under which a revocable trust may be amended or revoked, particularly in cases with multiple settlors.
  • Fiduciary Responsibilities: Clarifies the duties and liabilities of various parties involved in the trust, such as trustees, directing parties, investment and distribution advisors, and trust protectors.
  • Inheritance: Amends laws regarding when a parent may be barred from inheriting from a child, primarily focusing on issues of abandonment, abuse, or estrangement.
  • Retirement Plans and Divorce: Stipulates that divorce revokes the ex-spouse’s rights to certain properties and roles in governing instruments unless otherwise stated.

Significant Changes to Existing Law

  • Extended Vesting Period: For trusts created after this bill takes effect, the time before trust interests must vest is increased to 500 years, providing more flexibility in financial structuring.
  • Modification of Uneconomic Trusts: Raises the threshold at which a trust can be deemed uneconomic and thus terminable from $50,000 to $150,000.
  • Clarification and Simplification: Improves the clarity of various trust-related processes, such as providing documentation that supports oral trusts and managing trust property effectively.
  • Parental Inheritance Barriers: Introduces clearer criteria for barring a parent’s inheritance rights based on relationship conditions with the child.

Relevant Terms

  • Nonvested interest
  • Power of appointment
  • Irrevocable trust
  • Revocable trust
  • Fiduciary
  • Trust protector
  • Trust modification
  • Uneconomic trust
  • Parental inheritance
  • Divorce and retirement plans

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
February 26, 2025HouseFloorActionReceived from Senate
January 22, 2025SenateFloorActionIntroduction and first reading
January 22, 2025SenateFloorActionReferred toJudiciary and Public Safety
February 26, 2025HouseFloorActionSenate file first reading, referred for comparison
March 02, 2025HouseFloorActionBills identical, SF substituted on General Register
January 29, 2025SenateFloorActionComm report: To pass as amended
January 29, 2025SenateFloorActionSecond reading
March 02, 2025HouseFloorActionSecond reading
March 16, 2025HouseFloorActionHouse rule 1.21, placed on Calendar for the Day
February 26, 2025SenateFloorActionAuthor added
February 26, 2025SenateFloorActionSpecial Order
February 26, 2025SenateFloorActionThird reading Passed

Citations

 
[
  {
    "analysis": {
      "added": [
        "The application of a 500-year term for nonvested property interests in new trusts."
      ],
      "removed": [],
      "summary": "This section addresses the validity of nonvested interests and powers of appointment.",
      "modified": []
    },
    "citation": "501A.01"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "This is referenced in relation to the requirements for conveying interest in land.",
      "modified": [
        "Requirement for written or oral trust creation regarding conveyance of land."
      ]
    },
    "citation": "513.04"
  },
  {
    "analysis": {
      "added": [
        "Circumstances when a child dies before 18 and parent's right could have been terminated."
      ],
      "removed": [],
      "summary": "Defines when a parent is barred from inheriting from a deceased child under certain circumstances.",
      "modified": [
        "Terms under which a parent is considered predeceased for intestate succession."
      ]
    },
    "citation": "524.2-114"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Addresses revocation of dispositions and appointments upon dissolution of marriage.",
      "modified": [
        "Clarifies revocation applies to fiduciary nominations too."
      ]
    },
    "citation": "524.2-804"
  }
]

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