1. In order to allow a trust to qualify as a marital deduction trust for federal estate tax purposes, as a qualified subchapter S trust for federal income tax purposes, as separate trusts for federal generation-skipping tax purposes, or for any other federal or state income, estate, excise, or inheritance tax benefit or to facilitate the administration of a trust or trusts, the governing instrument of a trust may be amended as follows to permit the trust to be divided into one or more separate trusts or be consolidated with one or more other trusts into a single trust:
a. The trust governing instrument may be amended in any respect by any method set forth in the instrument or provided by law.
b. The trust governing instrument may also be amended by the trustee with the written approval of the settlor, and the living and competent beneficiaries entitled to income designated in the governing instrument by name or by class. The approval of a deceased or incapacitated settlor shall not be required.
c. If one or more of the required approvals cannot be obtained, the trustee may apply to the court that would have jurisdiction over the trust for approval of the amendment.
2. For purposes of obtaining the approval of the beneficiaries of a trust by agreement or by the court, the doctrine of virtual representation shall apply.
3. The court shall approve the amendment unless it determines that the proposed amendment will defeat or substantially impair the accomplishment of the trust purposes.
4. The effective date of an amendment shall be specified by the document, agreement, or order making or approving the amendment and the jurisdiction of the court shall be limited to the amendment proceeding unless the trust is being administered subject to court supervision.
94 Acts, ch 1153, §12
Referred to in § 633.703B
© 1997 Cornell College and League of Women Voters of Iowa
Last update: Mon Jan 27 16:05:08 CST 1997