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PAG LIN 1 1 Section 1. Section 450.1, Code 1995, is amended to read as 1 2 follows: 1 3 450.1 DEFINITIONS– AUTHORITY OF COUNTY ATTORNEYAND 1 4 CONSTRUCTION. 1 5 1. In the construction of this chapterthe word "person"1 6shall include: 1 7 a. "Child" includes a legally adopted child, an 1 8 illegitimate child entitled to inherit under the laws of this 1 9 state, and a stepchild. 1 10 b. "Lineal descendant of the decedent" includes 1 11 descendants of a stepchild of the deceased person, and persons 1 12 legally adopted by a descendant of the deceased person. 1 13 c. "Person" includes plural as well as singular, and 1 14 artificial as well as natural persons. 1 15 d. "Stepchild" shall include only the child of a person 1 16 who was married to the deceased person at the time of the 1 17 deceased person's death, or the child of a person to whom the 1 18 deceased person was married, which person died during the 1 19 marriage to the deceased person. 1 20 2. This chapter shall not be construed to confer upon a 1 21 county attorney authority to represent the state in any case, 1 22 and the county attorney shall represent the department of 1 23 revenue and finance only when especially authorized byitthe 1 24 department to do so. 1 25 3. For purposes of this chapter, unless the context 1 26 otherwise requires,: 1 27 a. "Internal Revenue Code" means the same as defined in 1 28 section 422.3. 1 29 b. "personalPersonal representative" means an executor, 1 30 administrator, or trustee as each is defined in section 633.3 1 31and "Internal Revenue Code" means the same as defined in1 32section 422.3. 1 33 Sec. 2. Section 450.2, Code 1995, is amended by striking 1 34 the section and inserting in lieu thereof the following: 1 35 450.2 TAXABLE PROPERTY. 2 1 The following property which passes from the decedent owner 2 2 in any manner described in this chapter is subject to tax as 2 3 provided in this chapter: 2 4 1. Property of a decedent owner domiciled in this state at 2 5 the time of death except real estate and tangible personal 2 6 property located outside of this state. 2 7 2. Real or tangible personal property located in this 2 8 state in which a nonresident decedent has an interest at the 2 9 time of death. 2 10 Sec. 3. Section 450.3, subsection 2, Code 1995, is amended 2 11 to read as follows: 2 12 2. By deed, grant, sale, gift or transfer made within 2 13 three years of the death of the grantor or donor, which is not 2 14 a bona fide sale for an adequate and full consideration in 2 15 money or money's worth and which is in excess of the annual 2 16 gift tax exclusion allowable for each donee under section 2 17 2503, subsections b and e of the Internal Revenue Code. If 2 18 both spouses consent, a gift made by one spouse to a person 2 19 who is not the other spouse is considered, for the purposes of 2 20 this subsection, as made one half by each spouse under the 2 21 same terms and conditions provided for in section 2513 of the 2 22 Internal Revenue Code. Net market value for the purpose of 2 23 this subsection is the net market value at the date of 2 24 transfer. 2 25 Sec. 4. Section 450.4, subsection 4, Code 1995, is amended 2 26 to read as follows: 2 27 4. Bequests for the care and maintenance of the cemetery 2 28 or burial lot of the decedent or the decedent's family, and 2 29 bequests not to exceedfive hundredone thousand dollars in 2 30 any estate of a decedent for the performance of a religious 2 31 service or services by some person regularly ordained, 2 32 authorized, or licensed by some religious society to perform 2 33 such service, which service or services are to be performed 2 34 for or in behalf of the testator or some person named in the 2 35 testator's last will. 3 1 Sec. 5. Section 450.4, subsection 5, Code 1995, is amended 3 2 by striking the subsection and inserting in lieu thereof the 3 3 following: 3 4 5. On that portion of the decedent's interest in a pension 3 5 or retirement plan that will be includable as net income as 3 6 defined in section 422.7, when paid to the beneficiary. 3 7 Sec. 6. Section 450.9, subsections 2 and 4, Code 1995, are 3 8 amended to read as follows: 3 9 2. Eachson and daughter, including legally adopted sons3 10and daughters, or biological sons and daughters entitled to3 11inherit under the law of this statechild, fifty thousand 3 12 dollars. 3 13 4. Any other lineal descendant of thedeceaseddecedent, 3 14 fifteen thousand dollars. 3 15 Sec. 7. Section 450.10, subsection 1, unnumbered paragraph 3 16 1, Code 1995, is amended to read as follows: 3 17 When the property, interest, or income passes to the father 3 18 or mother, or to a child or lineal descendant of the decedent, 3 19 grantor, donor, or vendor,including a legally adopted child3 20or biological child entitled to inherit under the laws of this3 21state,the tax imposed shall be on the individual share so 3 22 passing in excess of the exemptions allowed as follows: 3 23 Sec. 8. Section 450.10, subsection 2, unnumbered paragraph 3 24 1, Code 1995, is amended to read as follows: 3 25 When the property or any interest therein or income 3 26 therefrom taxable under the provisions of this chapter passes 3 27 to the brother or sister, son-in-law, or daughter-in-law,or3 28step-children,the rate of tax imposed on the individual share 3 29 so passing shall be as follows: 3 30 Sec. 9. NEW SECTION. 450.11 COMPROMISE SETTLEMENT AND 3 31 WILL CONTEST. 3 32 The distribution of property of the decedent pursuant to a 3 33 compromise settlement, an order of court approving a 3 34 compromise settlement, or an order of court settling a will 3 35 contest or disposing of a will contest, when such distribution 4 1 is based on valid claims and the distribution is economically 4 2 fair based on such claims, shall be binding upon the 4 3 department as to recipients of property and valuation of 4 4 property interests passing from the decedent for a 4 5 determination of inheritance tax under this chapter. 4 6 Sec. 10. Section 450.20, unnumbered paragraph 1, Code 4 7 1995, is amended to read as follows: 4 8ItThe department of revenue and finance shall also keep a 4 9 separate record of any deferred estate upon which the tax due 4 10 is not paidwithin fifteen months fromon or before the last 4 11 day of the ninth month after the death of the decedent, 4 12 showing substantially the same facts as are required in other 4 13 cases, and also showing: 4 14 Sec. 11. Section 614.14, subsection 4, paragraph b, Code 4 15 1995, is amended to read as follows: 4 16 b. That, to the knowledge of the trustee, the person 4 17 creating the trust was under no disability or infirmity at the 4 18 time the trust was created. 4 19 Sec. 12. Section 633.10, subsection 4, Code 1995, is 4 20 amended by adding the following new paragraph: 4 21 NEW PARAGRAPH. d. A trust that is administered solely or 4 22 jointly by an individual trustee or trustees is not subject to 4 23 the jurisdiction of the court unless jurisdiction is invoked 4 24 by a trustee or beneficiary, or if otherwise provided by the 4 25 governing instrument. Upon application of all trustees 4 26 administering a trust which is subject to the court's 4 27 jurisdiction, and following notice to beneficiaries as 4 28 provided in section 633.40, subsection 4, the court shall 4 29 release the trust from further jurisdiction unless one or more 4 30 beneficiaries object, on the condition that jurisdiction may 4 31 thereafter be invoked by a trustee or beneficiary. The 4 32 provisions of this paragraph shall be effective for 4 33 applications filed on or after July 1, 1996. 4 34 Sec. 13. Section 633.31, Code 1995, is amended by adding 4 35 the following new subsection: 5 1 NEW SUBSECTION. 3. The fee set forth in subsection 2, 5 2 paragraph "k" shall not be charged on any property transferred 5 3 to a testamentary trust from an estate that has been 5 4 administered in this state and for which court costs have been 5 5 assessed and paid. 5 6 Sec. 14. Section 633.410, Code Supplement 1995, is amended 5 7 to read as follows: 5 8 633.410 LIMITATION ON FILING CLAIMS AGAINST DECEDENT'S 5 9 ESTATE. 5 10 All claims against a decedent's estate, other than charges, 5 11 whether due or to become due, absolute or contingent, 5 12 liquidated or unliquidated, founded on contract or otherwise, 5 13 are forever barred against the estate, the personal 5 14 representative, and the distributees of the estate, unless 5 15 filed with the clerk within the later to occur of four months 5 16 after the date of the second publication of the notice to 5 17 creditors or, as to each claimant whose identity is reasonably 5 18 ascertainable, one month after service of notice by ordinary 5 19 mail to the claimant's last known address. However, notice is 5 20 not required to be given by mail to any creditor whose claim 5 21 will be paid or otherwise satisfied during administration and 5 22 the personal representative may waive the limitation on filing 5 23 provided under this section. This section does not bar claims 5 24 for which there is insurance coverage, to the extent of the 5 25 coverage,claims for debts created under section 249A.55 26relating to the recovery of medical assistance payments,or 5 27 claimants entitled to equitable relief due to peculiar 5 28 circumstances. 5 29 Sec. 15. Section 633.440, Code 1995, is amended to read as 5 30 follows: 5 31 633.440 CONTENTS OF NOTICE OF DISALLOWANCE. 5 32 Such a notice of disallowance shall advise the claimant 5 33 that the claim has been disallowed and will be forever barred 5 34 unless the claimant shall within twenty days after the date of 5 35 mailing the notice, file a request for hearing on the claim 6 1 with the clerk, and mail a copy of such request for hearing to 6 2 the personal representative and the attorney of record, if 6 3 any, by certified mail. 6 4 Sec. 16. Section 633.681, Code 1995, is amended to read as 6 5 follows: 6 6 633.681 ASSETS OF MINOR WARD EXHAUSTED. 6 7 When the assets of a minor ward's conservatorship are 6 8 exhausted or consist of personal property only of an aggregate 6 9 value not in excess offourten thousand dollars, the court, 6 10 upon application or upon its own motion, may terminate the 6 11 conservatorshipand. The order for termination shall direct 6 12 the conservator to delivertheany property remaining after 6 13 the payment of allowed claims and expenses of administration 6 14 tothe parent or other person entitled to the custody of the6 15minor ward, for the use of the ward, after payment of allowed6 16claims and expenses of administrationa custodian under any 6 17 uniform transfers to minors Act. Such delivery shall have the 6 18 same force and effect as if delivery had been made to the ward 6 19 after attaining majority. 6 20 Sec. 17. Section 633.704, subsection 3, paragraph a, Code 6 21 Supplement 1995, is amended to read as follows: 6 22 a. PASSAGE OF DISCLAIMED INTEREST OR PROPERTY. Unless the 6 23 transferor has otherwise provided, the property, interest, or 6 24 right disclaimed, and any future interest which is to take 6 25 effect in possession or enjoyment at or after the termination 6 26 of the interest or right disclaimed, descends or shall be 6 27 distributed as if the disclaimant has died prior to the date 6 28 of the transfer, or if the disclaimant is one designated to 6 29 take pursuant to a power of appointment exercised by 6 30 testamentary instrument, then as if the disclaimant has 6 31 predeceased the donee of the power unless the donee of the 6 32 power has otherwise provided. In every case, the disclaimer 6 33 relates back for all purposes to the date of the transfer.In6 34the case of a disclaiming beneficiary under a will, other than6 35a spouse, the property, interest, or right disclaimed passes7 1to the heirs of the disclaimant unless from the terms of the7 2transferor's will the intent is clear and explicit to the7 3contrary, in which event the property, interest, or right7 4disclaimed passes pursuant to the will.In the case of a 7 5 disclaimer under a will by a spouse the property, interest, or 7 6 right disclaimed lapses unless from the terms of the 7 7 transferor's will the intent is clear and explicit to the 7 8 contrary. 7 9 Sec. 18. NEW SECTION. 633.800 SHORT TITLE – RULES OF 7 10 CONSTRUCTION. 7 11 1. This division shall be known and may be cited as the 7 12 uniform transfer on death security registration Act. 7 13 2. The provisions of this division shall be liberally 7 14 construed and applied to promote its underlying purposes and 7 15 policy and to make uniform the laws with respect to the 7 16 subject of its provisions among states enacting this uniform 7 17 Act. 7 18 3. Unless displaced by the particular provisions of this 7 19 division, the principles of law and equity supplement the 7 20 provisions of this division. 7 21 Sec. 19. NEW SECTION. 633.801 DEFINITIONS. 7 22 As used in this division, unless the context otherwise 7 23 requires: 7 24 1. "Beneficiary form" means a registration of a security 7 25 which indicates the present owner of the security and the 7 26 intention of the owner regarding the person who will become 7 27 the owner of the security upon the death of the owner. 7 28 2. "Devisee" means any person designated in a will to 7 29 receive a disposition of real or personal property. 7 30 3. "Heir" means a person, including the surviving spouse, 7 31 who is entitled under the statutes of intestate succession to 7 32 the property of a decedent. 7 33 4. "Register" means to issue a certificate showing the 7 34 ownership of a certificated security or, in the case of an 7 35 uncertificated security, to initiate or transfer an account 8 1 showing ownership of the security. 8 2 5. "Registering entity" means a person who originates or 8 3 transfers a security title by registration, including a broker 8 4 maintaining security accounts for customers and a transfer 8 5 agent or other person acting for or as an issuer of 8 6 securities. 8 7 6. "Security" means a share, participation, or other 8 8 interest in property, in a business, or in an obligation of an 8 9 enterprise or other issuer, including a certificated security, 8 10 an uncertificated security, and a security account. 8 11 7. "Security account" means either of the following: 8 12 a. Any of the following whether or not credited to the 8 13 account before the owner's death: 8 14 (1) A reinvestment account associated with a security. 8 15 (2) A securities account with a broker. 8 16 (3) A cash balance in a brokerage account. 8 17 (4) Cash, interest, earnings, or dividends earned or 8 18 declared on a security in an account, a reinvestment account, 8 19 or a brokerage account. 8 20 b. A cash balance or other property held for or due to the 8 21 owner of a security as a replacement for or product of an 8 22 account security, whether or not credited to the account 8 23 before the owner's death. 8 24 8. "State" includes any state of the United States, the 8 25 District of Columbia, the Commonwealth of Puerto Rico, and any 8 26 territory or possession subject to the legislative authority 8 27 of the United States. 8 28 Sec. 20. NEW SECTION. 633.802 REGISTRATION IN 8 29 BENEFICIARY FORM – SOLE OR JOINT TENANCY OWNERSHIP. 8 30 Only an individual whose registration of a security shows 8 31 sole ownership by one individual or multiple ownership by two 8 32 or more individuals with a right of survivorship, rather than 8 33 as tenants in common, may obtain registration in beneficiary 8 34 form. Multiple owners of a security registered in beneficiary 8 35 form shall hold as joint tenants with rights of survivorship, 9 1 tenants by the entireties, or owners of community property 9 2 held in survivorship form and not as tenants in common. 9 3 Sec. 21. NEW SECTION. 633.803 REGISTRATION IN 9 4 BENEFICIARY FORM – APPLICABLE LAW. 9 5 1. A security may be registered in beneficiary form if the 9 6 form is authorized by this division or a similar statute of 9 7 the state of any of the following: 9 8 a. The state of organization of the issuer or registering 9 9 entity. 9 10 b. The state of location of the registering entity's 9 11 principal office. 9 12 c. The state of location of the office of the entity's 9 13 transfer agent or the office of the entity making the 9 14 registration. 9 15 d. The state of the address listed as the owner's at the 9 16 time of registration. 9 17 2. A registration governed by the law of a jurisdiction in 9 18 which this division or a similar statute is not in force or 9 19 was not in force when a registration in beneficiary form was 9 20 made is presumed to be valid and authorized as a matter of 9 21 contract law. 9 22 Sec. 22. NEW SECTION. 633.804 ORIGINATION OF 9 23 REGISTRATION IN BENEFICIARY FORM. 9 24 A security, whether evidenced by a certificate or account, 9 25 is registered in beneficiary form when the registration 9 26 includes a designation of a beneficiary to take the ownership 9 27 at the death of the owner or the deaths of all multiple 9 28 owners. 9 29 Sec. 23. NEW SECTION. 633.805 FORM OF REGISTRATION IN 9 30 BENEFICIARY FORM. 9 31 Registration in beneficiary form may be shown by any of the 9 32 following, appearing after the name of the registered owner 9 33 and before the name of a beneficiary: 9 34 1. The words "transfer on death" or the abbreviation 9 35 "TOD". 10 1 2. The words "pay on death" or the abbreviation "POD". 10 2 Sec. 24. NEW SECTION. 633.806 EFFECT OF REGISTRATION IN 10 3 BENEFICIARY FORM. 10 4 The designation of a transfer on death or pay on death 10 5 beneficiary on a registration in beneficiary form has no 10 6 effect on ownership until the owner's death. A registration 10 7 of a security in beneficiary form may be canceled or changed 10 8 at any time by the sole owner or all surviving owners without 10 9 the consent of the beneficiary. 10 10 Sec. 25. NEW SECTION. 633.807 THE DEATH OF THE OWNER. 10 11 On the death of a sole owner or on the death of the sole 10 12 surviving owner of multiple owners, the ownership of 10 13 securities registered in beneficiary form passes to the 10 14 beneficiary or beneficiaries who survive all owners. On proof 10 15 of death of all owners and compliance with any applicable 10 16 requirements of the registering entity, a security registered 10 17 in beneficiary form may be reregistered in the name of the 10 18 beneficiary or beneficiaries who survived the death of all 10 19 owners. A registering entity shall provide notice to the 10 20 department of revenue and finance of all reregistrations made 10 21 pursuant to this division. The notice shall include the name, 10 22 address, and social security number of the descendant and all 10 23 transferees. Until the division of the security after the 10 24 death of all owners, multiple beneficiaries surviving the 10 25 death of all owners hold their interests as tenants in common. 10 26 If no beneficiary survives the death of all owners, the 10 27 security belongs to the estate of the deceased sole owner or 10 28 the estate of the last to die of multiple owners. 10 29 Sec. 26. NEW SECTION. 633.808 PROTECTION OF REGISTERING 10 30 ENTITY. 10 31 1. A registering entity is not required to offer or to 10 32 accept a request for security registration in beneficiary 10 33 form. If a registration in beneficiary form is offered by a 10 34 registering entity, the owner requesting registration in 10 35 beneficiary form assents to the protections provided to the 11 1 registering entity by this division. 11 2 2. By accepting a request for registration of a security 11 3 in beneficiary form, the registering entity agrees that the 11 4 registration in beneficiary form shall be implemented on the 11 5 death of the deceased owner as provided in this division. 11 6 3. A registering entity is discharged from all claims to a 11 7 security by the estate, creditors, heirs, or devisees of a 11 8 deceased owner if the registering entity registers a transfer 11 9 of the security in accordance with section 633.807 and does so 11 10 in good faith reliance on all of the following: 11 11 a. The registration. 11 12 b. The provisions of this division. 11 13 c. Information provided by affidavit of the personal 11 14 representative of the deceased owner, the surviving 11 15 beneficiary, or the surviving beneficiary's representative, or 11 16 other information available to the registering entity. 11 17 The protections of this division do not extend to a 11 18 reregistration or payment made after a registering entity has 11 19 received written notice from any claimant to any interest in 11 20 the security objecting to implementation of a registration in 11 21 beneficiary form. No other notice or other information 11 22 available to the registering entity affects its right to 11 23 protection under this division. 11 24 4. The protection provided by this division to the 11 25 registering entity of a security does not affect the rights of 11 26 beneficiaries in disputes between themselves and other 11 27 claimants to ownership of the transferred security, its value, 11 28 or its proceeds. 11 29 Sec. 27. NEW SECTION. 633.809 NONTESTAMENTARY TRANSFER 11 30 ON DEATH. 11 31 1. A transfer on death resulting from a registration in 11 32 beneficiary form shall be effective by reason of the contract 11 33 regarding the registration between the owner and the 11 34 registering entity under the provisions of this division, and 11 35 is not testamentary. 12 1 2. The provisions of this division do not limit the rights 12 2 of creditors or security owners against beneficiaries and 12 3 other transferees under other laws of this state. 12 4 Sec. 28. NEW SECTION. 633.810 TERMS, CONDITIONS, AND 12 5 FORMS FOR REGISTRATION. 12 6 1. A registering entity offering to accept registrations 12 7 in beneficiary form may establish the terms and conditions 12 8 under which the registering entity receives requests for 12 9 either of the following: 12 10 a. Registration in beneficiary form. 12 11 b. Implementation of registrations in beneficiary form, 12 12 including requests for cancellation of previously registered 12 13 transfer on death or pay on death beneficiary designations and 12 14 requests for reregistration to effect a change of beneficiary. 12 15 2. a. The terms and conditions established by the 12 16 registering entity may provide for proving death, avoiding or 12 17 resolving problems concerning fractional shares, designating 12 18 primary and contingent beneficiaries, and substituting a named 12 19 beneficiary's descendants to take in place of the name 12 20 beneficiary in the event of the beneficiary's death. 12 21 Substitution may be indicated by appending to the name of the 12 22 primary beneficiary the letters "LDPS" standing for "lineal 12 23 descendants per stirpes". This designation shall substitute a 12 24 deceased beneficiary's descendants who survive the owner for a 12 25 beneficiary who fails to survive, with the descendants to be 12 26 identified and to share in accordance with the law of the 12 27 beneficiary's domicile at the owner's death governing 12 28 inheritance by descendants of an intestate. Other forms of 12 29 identifying beneficiaries who are to take on one or more 12 30 contingencies, and rules for providing proofs and assurances 12 31 needed to satisfy reasonable concerns by registering entities 12 32 regarding conditions and identities relevant to accurate 12 33 implementation of registrations in beneficiary form, may be 12 34 contained in a registering entity's terms and conditions. 12 35 b. The following are illustrations of registrations in 13 1 beneficiary form which a registering entity may authorize: 13 2 (1) Sole owner-sole beneficiary: OWNER'S NAME transfer on 13 3 death (TOD) or pay on death (POD) to BENEFICIARY'S NAME. 13 4 (2) Multiple owners-sole beneficiary: OWNERS' NAMES, as 13 5 joint tenants or tenants in the entirety, transfer on death 13 6 (TOD) or pay on death (POD) to BENEFICIARY'S NAME. 13 7 (3) Multiple owners-primary and secondary (substituted) 13 8 beneficiaries: OWNERS' NAMES as joint tenants or tenants in 13 9 the entirety, transfer on death (TOD) or pay on death (POD) to 13 10 BENEFICIARY'S NAME, or lineal descendants per stirpes. 13 11 Sec. 29. APPLICATION. The provisions of this division 13 12 relating to the uniform transfer on death security 13 13 registration Act apply to registrations of securities in 13 14 beneficiary form made before, on, or after the effective date 13 15 of this Act, by decedents dying on or after the effective date 13 16 of this Act. 13 17 Sec. 30. Sections 1 through 8 of this Act are applicable 13 18 to estates of decedents dying on or after July 1, 1996. 13 19 EXPLANATION 13 20 This bill amends sections of the inheritance tax and 13 21 probate chapters. 13 22 Sections 1 through 10 of the bill address inheritance tax 13 23 issues. Section 30 of the bill makes sections 1 through 8 13 24 applicable only to the estates of decedents dying on or after 13 25 July 1, 1996. Section 1 adds directions for construction of 13 26 the terms "child", "lineal descendant", and "stepchild", to 13 27 clearly include stepchildren in consideration of inheritance 13 28 tax issues. Sections 6, 7, and 8 use these terms in place of 13 29 lists of certain descendants for exemption and rate of tax 13 30 purposes. Stepchildren are taxed equally with biological 13 31 children under this bill. 13 32 Section 2 restates the property that is subject to 13 33 inheritance tax. Section 3 adds directions for determining 13 34 net market value (and, consequently, the taxable amount) 13 35 according to the date of transfer for certain taxable 14 1 property. Section 4 increases the limit for bequests for 14 2 religious services to $1,000. 14 3 Section 5 strikes the current provision on exemptions for 14 4 annuities purchased under a retirement or pension plan, and 14 5 replaces it with a similar provision related to any type of 14 6 interest in a pension or retirement plan. 14 7 Section 9 adds a new section regarding the distribution of 14 8 property pursuant to a compromise settlement and its treatment 14 9 for inheritance tax purposes, which makes Iowa law consistent 14 10 with federal tax law on this issue. Section 10 changes the 14 11 time period for filings of records of deferred estates. 14 12 Sections 11 through 16 of the bill address probate code 14 13 sections. Section 11 changes the warranty the trustee makes 14 14 regarding the trustor's condition at the time of creation of 14 15 the trust. Section 12 adds a new paragraph releasing certain 14 16 testamentary trusts from the jurisdiction of the court, to 14 17 allow such the same opportunities as other types of trusts. 14 18 Section 13 exempts certain property transferred from a 14 19 testamentary trust from certain statutory fees, to prohibit a 14 20 trust from being charged fees after the estate has paid its 14 21 fees. Section 14 repeals a change made last year that 14 22 exempted claims based on medical assistance payments from the 14 23 limitation on claims against an estate. 14 24 Section 15 requires a request for a hearing on a notice of 14 25 disallowance of a claim against an estate to be mailed not 14 26 only to the personal representative, but also to any attorney 14 27 of record. Section 16 permits a court to terminate a 14 28 conservatorship where the value of the property is $10,000 or 14 29 less, an increase over the current statutory amount of $4,000. 14 30 Section 17 removes language regarding a disclaimer made by a 14 31 beneficiary, to make it consistent with the antilapse 14 32 provisions of the Code in sections 633.273 and 633.274. 14 33 Sections 18 through 29 of this bill adopt the uniform 14 34 transfer on death (TOD) security registration Act as approved 14 35 and recommended by the national conference of commissioners on 15 1 uniform state laws at its annual conference on July 28 - 15 2 August 4, 1989. The bill allows the owner of securities to 15 3 register the title in "transfer-on-death" (TOD) form. The 15 4 bill provides that a person (e.g., an issuer or broker) may 15 5 transfer the securities directly to the designated transferee 15 6 on the owner's death, passing outside the probate process. 15 7 The registration provides a nonprobate transfer option without 15 8 providing for joint tenancy form of title. The registration 15 9 form does not affect the registered owner's control of the 15 10 affected security during the lifetime of the owner. The bill 15 11 provides for the right of survivorship by registered owners 15 12 and the rights of beneficiaries to take the asset upon the 15 13 death of the last surviving owner. An issuer is not required 15 14 to implement the procedure, and the bill provides protections 15 15 to the registering entity who acts in good faith. 15 16 Specifically, those sections of the bill include the 15 17 following new Code sections: 15 18 Section 633.800 provides for citation of the Act as the 15 19 Uniform Transfer on Death Security Registration Act and for 15 20 liberal construction of the Act to achieve uniformity among 15 21 states enacting this Act. 15 22 Section 633.801 provides definitions of relevant terms used 15 23 in TOD registration including "beneficiary form", "heir", 15 24 "register", "registering entity", "security", "security 15 25 account", and "state". 15 26 Terms such as "beneficiary form", "register", "registering 15 27 entity", "security", and "security account", are new terms to 15 28 the Probate Code and relate to securities products generally 15 29 and the companies that sell them. The term "security" is 15 30 defined similarly to the term defined in the Uniform 15 31 Commercial Code (Chapter 554) and is similar to section 15 32 554.8102. The bill defines the term "heir" differently than 15 33 provided in the probate Code, to include a surviving spouse. 15 34 Section 633.802 provides that a sole owner or multiple 15 35 owners of a security held in survivorship form may elect to 16 1 register their ownership in beneficiary form. This 16 2 registration is not available to persons holding as tenants in 16 3 common. 16 4 Section 633.803 provides circumstances which must exist 16 5 before a security may be registered in beneficiary form and 16 6 recognized under the bill's provisions. Further, the bill 16 7 provides general rights under Iowa contract law for Iowa 16 8 residents who elect beneficiary form registration of products 16 9 issued from or held in states that have not adopted the 16 10 Uniform Transfer on Death Security Registration Act. 16 11 Section 633.804 defines how registration in beneficiary 16 12 form takes place. 16 13 Section 633.805 adopts certain words and abbreviations 16 14 which will show registration in beneficiary form. These are 16 15 "transfer on death", "TOD", "pay on death", and "POD". 16 16 Section 633.806 explains that a designation of a "TOD" or 16 17 "POD" beneficiary has no effect until the death of the owner 16 18 or the death of the last multiple owner and can be changed 16 19 without consent of the beneficiary. 16 20 Section 633.807 provides that on proof of death and 16 21 compliance with any requirements of the registering entity, 16 22 the security may be reregistered in the name of the designated 16 23 beneficiary. The bill requires the registering entity to 16 24 provide notice of reregistrations to the department of revenue 16 25 and finance. On the death of the owner, multiple 16 26 beneficiaries will hold as tenants in common. The bill also 16 27 provides guidelines for circumstances when no beneficiary 16 28 survives. 16 29 Section 633.808 provides that a registering entity which 16 30 elects to provide registration of securities in beneficiary 16 31 form agrees to the conditions of this division. The 16 32 registering entity is discharged from other claims to the 16 33 security if it acts in good faith reliance on the registration 16 34 and information provided by affidavit. The section provides 16 35 that it does not provide protection to a registering entity 17 1 which reregisters or distributes a security after receiving 17 2 written notice of an objection to registration in beneficiary 17 3 form. The bill does not attempt to regulate the rights or 17 4 claims of beneficiaries in disputes among themselves. 17 5 Section 633.809 provides that transfers made under the 17 6 bill's provisions are not testamentary and do not limit the 17 7 rights of creditors against beneficiaries. 17 8 Section 633.810 provides that the registering entity may 17 9 define the precise forms and conditions for registration in 17 10 beneficiary form. This includes examples of recommended 17 11 registrations to be used by registering entities to resolve 17 12 questions regarding fractional shares. 17 13 Section 29 of the bill provides for application of the 17 14 provisions of the bill to registrations of securities in 17 15 beneficiary form which predate or postdate adoption of the 17 16 bill for decedents dying on or after the effective date of the 17 17 bill. 17 18 LSB 4433SV 76 17 19 jls/sc/14.1
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