Text: HF02172 Text: HF02174 Text: HF02100 - HF02199 Text: HF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN
1 1 Section 1. NEW SECTION. 633.699A MODIFICATION OR
1 2 TERMINATION OF TRUST.
1 3 1. On petition by a trustee or beneficiary, the court may
1 4 modify the provisions of the trust or terminate the trust in
1 5 whole or in part if the continuation of the trust under its
1 6 terms would defeat or substantially impair the accomplishment
1 7 of the purposes of the trust, or if the purposes of the trust
1 8 have been fulfilled, or have become illegal or impossible to
1 9 fulfill.
1 10 a. The court may order the trustee to do acts that are not
1 11 authorized or are forbidden by the trust instrument, or may
1 12 order that the trustee be prohibited from performing acts that
1 13 are required by the terms of the trust.
1 14 b. The existence of a trust provision restraining transfer
1 15 of the beneficiary's interest does not prevent application of
1 16 this subsection.
1 17 2. On petition by a trustee or beneficiary, if the court
1 18 determines that the fair market value of a trust has become so
1 19 low in relation to the cost of administration that
1 20 continuation of the trust under its existing terms will defeat
1 21 or substantially impair the accomplishment of its purposes,
1 22 the court may, in its discretion, order termination of the
1 23 trust, modification of the trust, or appointment of a new
1 24 trustee.
1 25 a. Notwithstanding subsection 2, if the trust principal
1 26 does not exceed twenty thousand dollars in value, the trustee
1 27 has the power to terminate the trust without petitioning the
1 28 court. However, the trustee may seek approval of the court,
1 29 or may seek instruction on issues related to terminating the
1 30 trust.
1 31 b. The existence of a trust provision restraining transfer
1 32 of the beneficiary's interest does not prevent application of
1 33 this subsection.
1 34 EXPLANATION
1 35 This bill adds a new section to the probate code pertaining
2 1 to modification or termination of trusts. The section
2 2 proposes that the court may modify or terminate a trust when
2 3 the enforcement of the terms of a trust is no longer
2 4 consistent with the purposes of the trust, or it is impossible
2 5 to continue the trust. A subsection of the proposed provision
2 6 expressly permits the court to modify or terminate a trust
2 7 that has become uneconomical to administer, and permits a
2 8 trustee to make this determination when the principal of the
2 9 trust is less than $20,000.
2 10 LSB 3465YH 76
2 11 jls/jw/5
Text: HF02172 Text: HF02174 Text: HF02100 - HF02199 Text: HF Index Bills and Amendments: General Index Bill History: General Index
Iowa General Assembly
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