House Study Bill 151 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON JUDICIARY BILL BY CHAIRPERSON ANDERSON) A BILL FOR An Act relating to the probate and trust codes and state 1 inheritance tax and medical assistance claims and including 2 applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1053HC (8) 84 rh/rj

H.F. _____ Section 1. Section 422.7, subsection 4, Code 2011, is 1 amended by striking the subsection. 2 Sec. 2. Section 450.4, subsections 7 and 8, Code 2011, are 3 amended by striking the subsections. 4 Sec. 3. Section 633.237, subsections 1, 2, and 4, Code 2011, 5 are amended to read as follows: 6 1. Following the appointment of a personal representative 7 of the estate of the decedent, who is not the spouse, the 8 personal representative shall cause to be served a written 9 notice upon the surviving spouse pursuant to section 633.40, 10 subsection 5 , notifying the surviving spouse that unless, 11 within four months after service of the notice, the spouse 12 files an election in writing with the clerk of court electing 13 the share as set forth in section 633.236 and sections 633.238 14 through 633.246 , the spouse shall be deemed to take under 15 the will or to receive the intestate share. If, within the 16 four-month period following service of the notice, an affidavit 17 is filed setting forth that the surviving spouse is incapable 18 of making the election and does not have a conservator, the 19 personal representative shall make application to the court for 20 an order pursuant to section 633.244 . 21 2. Following the death of a settlor of a revocable trust, 22 the trustee of such revocable trust who is not the spouse 23 shall cause to be served a written notice upon the surviving 24 spouse pursuant to section 633.40, subsection 5 , notifying 25 the surviving spouse that unless, within four months after 26 service of the notice, the spouse files an election with the 27 trustee electing the share as set forth in section 633.236 and 28 sections 633.238 through 633.246 , the spouse shall be deemed 29 to take under the terms of the revocable trust. If, within the 30 four-month period following service of the notice, an affidavit 31 is filed setting forth that the surviving spouse is incapable 32 of making the election and does not have a conservator, the 33 trustee shall make application to the court for an order 34 pursuant to section 633.244 . 35 -1- LSB 1053HC (8) 84 rh/rj 1/ 25

H.F. _____ 4. The notice provisions under subsections 1 and 2 are not 1 applicable if the surviving spouse is a personal representative 2 of the estate or a trustee of a revocable trust or if the 3 surviving spouse or the spouse’s conservator files, at any 4 time, an election to take under the will, receive the intestate 5 share, or take under the revocable trust. If the surviving 6 spouse fails to file an election under this section within four 7 months of the decedent’s death date notice is served , it shall 8 be conclusively presumed that the surviving spouse elects to 9 take under the will, receive the intestate share, or take under 10 the revocable trust. 11 Sec. 4. Section 633.246, Code 2011, is amended to read as 12 follows: 13 633.246 Election not subject to change. 14 1. An election by or on behalf of a surviving spouse to 15 take the share provided in section 633.211 , 633.212 , 633.236 , 16 633.238 , 633.240 , or 633.244 shall be binding and shall not be 17 subject to change except for such causes as would justify an 18 equitable decree for the rescission of a deed. 19 2. An affirmative election to take under the will, receive 20 the intestate share, or take under the revocable trust shall be 21 irrevocable when filed as provided in section 633.237. 22 Sec. 5. Section 633.374, Code 2011, is amended to read as 23 follows: 24 633.374 Allowance to surviving spouse. 25 1. If the personal representative of the estate is not 26 the decedent’s spouse, the The personal representative of the 27 estate shall cause written notice concerning support to be 28 mailed mail to the surviving spouse pursuant to section 633.40, 29 subsection 5 , a written notice regarding the right to request 30 a spousal allowance . The notice shall inform the surviving 31 spouse of the surviving spouse’s right to apply, submit an 32 application to the court within four months of service of the 33 notice, for support for a period of twelve months following 34 the death of the decedent, and for support of the decedent’s 35 -2- LSB 1053HC (8) 84 rh/rj 2/ 25

H.F. _____ dependents who reside with the spouse for the same period of 1 time. 2 2. The court shall, upon application, set off and order 3 paid to the surviving spouse, as part of the costs of 4 administration, sufficient of the decedent’s property including 5 assets held in a revocable trust of which the decedent is the 6 settlor to the extent that estate assets are not sufficient as 7 it deems reasonable for the proper support of the surviving 8 spouse for the period of twelve months following the death of 9 the decedent. If the application is not made by the personal 10 representative, notice Notice of hearing upon the application 11 shall be given to the surviving spouse, personal representative 12 if the application is not made by the personal representative, 13 trustee of any revocable trust of which the decedent is the 14 settlor, and all other interested persons . The court shall 15 take into consideration the station in life of the surviving 16 spouse , and the assets and condition of the estate and any 17 revocable trust of which the decedent is the settlor, the 18 nonprobate assets received by the surviving spouse by reason of 19 the death of the decedent, and the income and other resources 20 of the surviving spouse . If the trustee of a revocable 21 trust of which the decedent was a settlor has previously made 22 payments under section 633A.3114 to the spouse, the court shall 23 reduce the award by the amount of such payments. The allowance 24 shall also include such additional amount as the court deems 25 reasonable for the proper support, during such period, of 26 dependents of the decedent who reside with the surviving 27 spouse. Such allowance to the surviving spouse shall not abate 28 upon the death or remarriage of such spouse. If an application 29 for support has not been filed within four months following 30 service of the notice by or on behalf of the surviving 31 spouse and the dependents of the decedent who reside with the 32 surviving spouse, the surviving spouse and the dependents of 33 the decedent shall be deemed to have waived the right to apply 34 for support during the administration of the estate. 35 -3- LSB 1053HC (8) 84 rh/rj 3/ 25

H.F. _____ 3. A surviving spouse who qualifies for a support allowance 1 under this section may waive the right to such allowance for 2 the surviving spouse and for the dependents of the decedent 3 who reside with the surviving spouse by filing an affidavit 4 acknowledging receipt of notice and irrevocably waiving the 5 right to support under this section. 6 Sec. 6. Section 633.375, Code 2011, is amended to read as 7 follows: 8 633.375 Review of allowance to surviving spouse. 9 The court may, upon the petition of the spouse, or other 10 person interested any interested person , and after hearing 11 pursuant to notice to all interested parties, review such the 12 allowance and increase or decrease the same amount and make 13 such other orders as it may deem proper . 14 Sec. 7. Section 633.376, Code 2011, is amended to read as 15 follows: 16 633.376 Allowance to children who do not reside with 17 surviving spouse. 18 1. The court may also make an allowance under the same terms 19 and conditions as provided in section 633.374 of an amount the 20 court deems reasonable in light of the assets and condition of 21 the estate, to provide for proper support during the period of 22 twelve months following the decedent’s death to a child of the 23 decedent who does not reside with the surviving spouse and is 24 any of the following: 25 a. less Less than eighteen years of age . 26 b. or who is between Between the ages of eighteen and 27 twenty-two years who is any of the following: 28 (1) regularly Regularly attending an accredited school in 29 pursuance of a course of study leading to a high school diploma 30 or its equivalent , . 31 (2) or regularly Regularly attending a course of 32 vocational-technical training either as a part of a regular 33 school program or under special arrangements adapted to the 34 individual person’s needs ; . 35 -4- LSB 1053HC (8) 84 rh/rj 4/ 25

H.F. _____ (3) or is Is , in good faith, a full-time student in a 1 college, university, or community college ; . 2 (4) or has Has been accepted for admission to a college, 3 university, or community college and the next regular term has 4 not yet begun ; . 5 c. or Is a child of any age who is dependent because of 6 physical or mental disability ; who does not reside with the 7 surviving spouse, of an amount it deems reasonable in the light 8 of the assets and condition of the estate, to provide for the 9 child’s proper support during the period of twelve months . 10 2. The estate’s personal representative shall cause 11 written notice to be mailed mail pursuant to section 633.40, 12 subsection 5 , to the legal guardian of each child qualified 13 under subsection 1 and to each child or the guardian ad litem 14 for such child if necessary, who has no legal guardian , a 15 written notice regarding the right to request an allowance . 16 The notice shall inform the child and the child’s guardian, 17 if applicable, of the right to apply submit an application to 18 the court , within four months after service of the notice, for 19 support for a period of twelve months following the decedent’s 20 death. If an application for support has not been filed within 21 four months after service of the notice by or on behalf of the 22 child qualifying for support under subsection 1 , the child 23 shall be deemed to have waived the right to support under this 24 section . A child who qualifies for support under this section 25 or the child’s guardian ad litem may waive the child’s right 26 to such support by filing an affidavit acknowledging receipt 27 of notice and irrevocably waiving the child’s right to support 28 under this section . 29 Sec. 8. Section 633.377, Code 2011, is amended to read as 30 follows: 31 633.377 Review of allowance to minor children. 32 The court may, upon the petition of any interested person, 33 and after hearing pursuant to notice to all interested parties, 34 review the allowance made to the minor children who do not 35 -5- LSB 1053HC (8) 84 rh/rj 5/ 25

H.F. _____ reside with the surviving spouse and may increase or decrease 1 the same amount and make such other orders as it may deem 2 proper. 3 Sec. 9. Section 633.471, Code 2011, is amended to read as 4 follows: 5 633.471 Right of retainer. 6 When a distributee of an estate is indebted to the estate, 7 or if a distributee takes as an heir of a deceased devisee 8 indebted to the estate, the amount of such indebtedness, if 9 due, or the present worth of the indebtedness, if not due, 10 shall be treated as a setoff and retained by the personal 11 representative out of any testate or intestate property, 12 real or personal, of the estate to which such distributee is 13 entitled. In intestate estates, the personal representative 14 shall have the same right of setoff and retainer against an 15 heir whose ancestor was indebted to the estate. The right of 16 setoff and retainer shall be prior and superior to the rights 17 of judgment creditors, heirs or assigns of such distributee and 18 shall not be barred by the statute of limitations, nor by a 19 discharge in bankruptcy . 20 Sec. 10. Section 633.561, Code 2011, is amended by adding 21 the following new subsection: 22 NEW SUBSECTION . 7. If the court determines upon application 23 that it is appropriate or necessary, the court may order that 24 the attorney appointed pursuant to this section be given copies 25 of and access to the proposed ward’s health information by 26 describing with reasonable specificity the health information 27 to be disclosed or accessed, for the purpose of fulfilling the 28 attorney’s responsibilities pursuant to this section. 29 Sec. 11. Section 633A.2203, Code 2011, is amended by adding 30 the following new subsection: 31 NEW SUBSECTION . 5. A spendthrift provision, or a provision 32 giving the trustee discretion to distribute income or principal 33 to a beneficiary or among beneficiaries, in the terms of the 34 trust is presumed to constitute a material purpose of the 35 -6- LSB 1053HC (8) 84 rh/rj 6/ 25

H.F. _____ trust. 1 Sec. 12. Section 633A.3104, subsection 2, Code 2011, is 2 amended by striking the subsection and inserting in lieu 3 thereof the following: 4 2. Following the death of a settlor, if the settlor’s estate 5 is inadequate to satisfy the debts of the settlor and the 6 charges of the settlor’s estate, the property of a revocable 7 trust, to the extent of the value of the property over which 8 the settlor had a power of revocation, is subject to all of the 9 following: 10 a. The charges of the settlor’s estate. 11 b. The debts of the settlor unless barred as provided in 12 section 633A.3109. 13 Sec. 13. Section 633A.3104, Code 2011, is amended by adding 14 the following new subsection: 15 NEW SUBSECTION . 2A. The personal representative of the 16 settlor’s estate shall submit a statement to the trustee 17 within the period for filing claims against the trust of the 18 amount by which the assets of the estate are insufficient 19 to pay the debts and charges. Subject to the provisions of 20 section 633A.3111, the trustee shall remit to the personal 21 representative the amount needed to pay the charges and shall 22 pay the debts directly to the creditors unless the trustee and 23 personal representative agree to a different manner of payment. 24 Sec. 14. Section 633A.3108, Code 2011, is amended by 25 striking the section and inserting in lieu thereof the 26 following: 27 633A.3108 Limitation on contest of revocable trust. 28 Unless previously barred by adjudication, consent, or other 29 limitation, if notice is published or given as provided in 30 section 633A.3110 within one year of the settlor’s death, a 31 proceeding to contest the validity of a revocable trust must be 32 brought within the period specified in that notice. If notice 33 is not published or given within that period, a proceeding to 34 contest the validity of a trust must be brought no later than 35 -7- LSB 1053HC (8) 84 rh/rj 7/ 25

H.F. _____ one year following the death of the settlor. 1 Sec. 15. Section 633A.3109, Code 2011, is amended by 2 striking the section and inserting in lieu thereof the 3 following: 4 633A.3109 Limitation on creditor rights against revocable 5 trust assets after settlor’s death. 6 1. If notice is published or given as provided in section 7 633A.3110 within one year of the settlor’s death, any claim 8 against the trust assets will be forever barred unless the 9 creditor files a claim as provided for and within the period 10 specified in the notice. 11 2. If notice is not published or given, a creditor of 12 a deceased settlor of a revocable trust must bring suit to 13 enforce its claim against the assets of the decedent’s trust 14 within one year of the decedent’s death or be forever barred 15 from collecting against the trust assets. The one-year 16 limitation period shall not be extended by the commencement of 17 probate administration for the settlor. 18 3. The notice under sections 633.230 and 633.304 in probate 19 of the settlor’s estate does not affect a creditor’s claim 20 under this section. 21 Sec. 16. Section 633A.3110, Code 2011, is amended by 22 striking the section and inserting in lieu thereof the 23 following: 24 633A.3110 Notice to creditors, heirs, and spouse. 25 1. As used in this section, “heir” means only such person 26 who would, in an intestate estate, be entitled to a share under 27 section 633.219. 28 2. The trustee may give notice as described herein to 29 creditors, heirs, and the surviving spouse of the settlor for 30 the purpose of establishing their rights to contest the trust 31 and to file claims against the trust assets. 32 a. No later than the end of the one-year period beginning 33 with the settlor’s date of death, the trustee may publish a 34 notice once each week for two consecutive weeks in a daily or 35 -8- LSB 1053HC (8) 84 rh/rj 8/ 25

H.F. _____ weekly newspaper of general circulation published in the county 1 in which the settlor was a resident at the time of death. If 2 the settlor was not a resident of Iowa, but the principal place 3 of administration is in Iowa, the trustee shall publish notice 4 in the county that is the principal place of administration 5 pursuant to section 633A.6102. 6 b. If notice is published pursuant to paragraph “a” , the 7 trustee shall also give notice by ordinary mail within one year 8 of the settlor’s death to the surviving spouse and the heirs of 9 the decedent whose identities are reasonably ascertainable, at 10 such person’s last known address. 11 c. If notice is published pursuant to paragraph “a” , the 12 trustee shall also give notice to creditors of the settlor who 13 are known or reasonably ascertainable within the period for 14 filing claims specified in the published notice and who the 15 trustee believes own or possess a claim, which will not or may 16 not be paid or otherwise satisfied during the administration of 17 the trust, by ordinary mail to each person at the person’s last 18 known address. 19 d. The notices described in this subsection shall, if given, 20 include notification of the settlor’s death, and the fact that 21 any action to contest the validity of the trust must be brought 22 within the later to occur of four months from the date of the 23 second publication of the notice made pursuant to paragraph “a” 24 or thirty days from the date of mailing of the notice pursuant 25 to paragraph “b” , and that any claim against the trust assets 26 will be forever barred unless proof of a creditor’s claim 27 is mailed to the trustee by certified mail, return receipt 28 requested, within the later to occur of four months from the 29 second publication of notice pursuant to paragraph “a” or 30 thirty days from the date of mailing the notice pursuant to 31 paragraph “b” , if required. A person who is not entitled to 32 receive a mailed notice or who does not make a claim within the 33 appropriate period is forever barred from asserting any claim 34 against the trust or the trust assets. 35 -9- LSB 1053HC (8) 84 rh/rj 9/ 25

H.F. _____ 3. If notice is published pursuant to paragraph “a” , claims 1 of creditors that are discovered or which become reasonably 2 ascertainable after the end of the notice period are barred. 3 4. If notice is not published and given as provided in 4 this section, the right to challenge the trust and file claims 5 against the trust assets are limited as provided in sections 6 633A.3108 and 633A.3109. 7 5. The notice described in subsection 2 shall be 8 substantially in the following form: 9 To all persons regarding ............., deceased, who died on 10 or about ......, (year) ...... You are hereby notified that 11 ............... is the trustee of the ................ Trust. 12 Any action to contest the validity of the trust must be 13 brought in the District Court of .... County, Iowa, within 14 the later to occur of four months from the date of second 15 publication of this notice, or thirty days from the date of 16 mailing this notice to all heirs of the decedent settlor 17 and the spouse of the decedent settlor whose identities are 18 reasonably ascertainable. Any suit not filed within this 19 period shall be forever barred. 20 Notice is further given that any person or entity possessing 21 a claim against the trust must mail proof of the claim to the 22 trustee at the address listed below via certified mail, return 23 receipt requested, by the later to occur of four months from 24 the second publication of this notice or thirty days from the 25 date of mailing this notice if required, or the claim shall be 26 forever barred, unless paid or otherwise satisfied. 27 Dated this ...... day of ......, (year).... 28 ..................................... Trust 29 ........................... 30 Trustee 31 Address: ...................... 32 ................................ 33 Date of second publication ... day of ......, (year) .... 34 6. The proof of claim must be in writing stating the party’s 35 -10- LSB 1053HC (8) 84 rh/rj 10/ 25

H.F. _____ name and address and describing the nature and amount of the 1 claim, if ascertainable, and accompanied by an affidavit of the 2 party or a representative of the party verifying the amount 3 that is due, or when the amount will become due, that no 4 payments have been made on the claim that are not credited, and 5 that no offsets to the claim exist. 6 7. At any time after receipt by the trustee of a proof of 7 claim, the trustee may give the party submitting the claim a 8 written notice of disallowance of the claim. The notice shall 9 be given by certified mail, return receipt requested, addressed 10 to the party at the address stated in the claim, and to the 11 attorney of record of the party submitting the claim. Such 12 notice of disallowance shall advise the party submitting the 13 claim that the claim has been disallowed and will be forever 14 barred unless suit is filed against the trustee to enforce 15 the claim within thirty days of the date of the mailing of 16 the notice of disallowance. If suit is filed, the provisions 17 in chapter 633 relating to actions to enforce a claim shall 18 apply with the trust and trustee substituted for the estate and 19 personal representative. 20 8. The trustee and creditor may agree to extend the 21 limitations period for filing an action to enforce the claim. 22 If the creditor fails to properly file its claim within the 23 established time period or bring an action to enforce its claim 24 within the established time period, the creditor’s claim shall 25 be forever barred. 26 9. The trustee shall give notice to the beneficiaries of the 27 trust as required by section 633A.4213. 28 10. The trustee shall give notice to the spouse of the right 29 to elect to take an elective share of the trust as required 30 by section 633.237 and the right to a spousal allowance as 31 required by section 633A.3114. 32 11. The trustee shall give notice to eligible children 33 not residing with the surviving spouse of their right to an 34 allowance as required by section 633A.3115. 35 -11- LSB 1053HC (8) 84 rh/rj 11/ 25

H.F. _____ Sec. 17. Section 633A.3111, Code 2011, is amended by 1 striking the section and inserting in lieu thereof the 2 following: 3 633A.3111 Rights of trustee regarding claims in a probate 4 administration. 5 1. If administration of an estate is commenced in which a 6 revocable trust or a trust in which a holder had at the date 7 of the holder’s death a presently exercisable general power 8 of appointment could be held responsible for the payment of 9 debts of the settlor or holder and the charges of the settlor’s 10 or holder’s estate, the trustee of the trust shall be an 11 interested party in the administration of the estate. 12 2. The trustee shall receive notice of all potential claims 13 against the trust assets from the personal representative of 14 the estate and must either authorize the payments for which 15 the trust may be found liable or be given the opportunity to 16 dispute or defend any such payment. 17 3. If debts of the settlor are paid from trust property, 18 the trustee or trust beneficiaries shall have a right to be 19 reimbursed from the settlor’s estate for such payment until the 20 final report of the settlor’s estate has been approved, unless 21 the debts have been barred from being collected from the estate 22 by notice pursuant to section 633.230 or 633.304. 23 Sec. 18. Section 633A.3112, Code 2011, is amended by 24 striking the section and inserting in lieu thereof the 25 following: 26 633A.3112 Trustee’s liability for distributions. 27 1. A trustee who distributes trust assets without making 28 adequate provisions for the payment of debts and charges that 29 are known or reasonably ascertainable at the time of the 30 distribution shall be jointly and severally liable with the 31 beneficiaries to the extent of the distributions made. 32 2. A trustee shall be entitled to indemnification from the 33 beneficiaries for all amounts paid for debts and charges under 34 this section, to the extent of distributions made. 35 -12- LSB 1053HC (8) 84 rh/rj 12/ 25

H.F. _____ Sec. 19. NEW SECTION . 633A.3113 Definitions —— revocable 1 trusts. 2 As used in this subchapter: 3 1. “Charges” means the same as defined in section 633.3. 4 2. “Costs of administration” means the same as defined in 5 section 633.3. 6 3. “Debts” means the same as defined in section 633.3. 7 Sec. 20. NEW SECTION . 633A.3114 Allowance to surviving 8 spouse. 9 1. Unless a personal representative has been appointed 10 for the settlor’s estate, following the death of a settlor of 11 a revocable trust, the trustee of such revocable trust shall 12 mail a written notice to the surviving spouse pursuant to 13 section 633.40, subsection 5, notifying the surviving spouse 14 of the surviving spouse’s right to submit an application to 15 the trustee, within four months of service of the notice, for 16 a support allowance for a period of twelve months following 17 the death of the settlor, and for a support allowance for the 18 settlor’s dependents who reside with the spouse for the same 19 period of time. 20 2. Upon receipt of an application for a support allowance, 21 the trustee may set off and pay to the surviving spouse a 22 sufficient amount of trust assets the trustee deems reasonable 23 for the proper support of the surviving spouse for the period 24 of twelve months following the death of the settlor. The 25 trustee shall take into consideration the station of life 26 of the settlor’s surviving spouse, the assets and condition 27 of the trust, the probate and nonprobate assets received by 28 the surviving spouse by reason of the settlor’s death, and 29 the income and other resources of the surviving spouse. The 30 allowance may also include such additional amount as the 31 trustee deems reasonable for the proper support, during such 32 period, of the dependents of the settlor who reside with the 33 surviving spouse. If an application for a support allowance 34 has not been filed within four months following service of 35 -13- LSB 1053HC (8) 84 rh/rj 13/ 25

H.F. _____ the notice by or on behalf of the surviving spouse and the 1 dependents of the settlor who reside with the surviving spouse, 2 the surviving spouse and dependents of the settlor shall 3 be deemed to have waived the right to apply for a support 4 allowance during the administration of the trust. 5 3. A surviving spouse who qualifies for a support allowance 6 under this section may waive the right to such allowance 7 for the surviving spouse and for the dependents of the 8 settlor who reside with the surviving spouse by submitting an 9 affidavit with the trustee acknowledging receipt of notice 10 and irrevocably waiving the right to an allowance under this 11 section. 12 4. The opening of an estate for the settlor shall terminate 13 the right of the surviving spouse to apply for a spousal 14 allowance from the trustee of the settlor’s revocable trust or 15 to receive additional support payments from the trust unless 16 the personal representative consents to a continuation of the 17 support payments. If a spousal allowance has been paid from 18 trust assets, the trustee or trust beneficiaries shall have 19 a right subject to court approval to be reimbursed from the 20 settlor’s estate for such payment until the final report of the 21 settlor’s estate has been approved. 22 Sec. 21. NEW SECTION . 633A.3115 Allowance to children who 23 do not reside with surviving spouse. 24 1. If the trustee is required to give notice under section 25 633A.3114, the trustee shall also mail, pursuant to section 26 633.40, subsection 5, to the legal guardian of each child 27 qualified under subsection 2 and to each such child or the 28 guardian ad litem for such child if necessary, who has no legal 29 guardian, a written notice regarding the right to request an 30 allowance. The notice shall inform the child and the child’s 31 guardian, if applicable, of the right to submit an application 32 to the trustee within four months after service of the notice, 33 for a support allowance for a period of twelve months following 34 the decedent’s death. 35 -14- LSB 1053HC (8) 84 rh/rj 14/ 25

H.F. _____ 2. Upon receipt of an application for a support allowance, 1 the trustee may make an allowance of an amount the trustee 2 deems reasonable in light of the assets and condition of the 3 trust, to provide for proper support during the period of 4 twelve months following the decedent’s death to a child of 5 the decedent who does not reside with the settlor’s surviving 6 spouse and is any of the following: 7 a. Less than eighteen years of age. 8 b. Between the ages of eighteen and twenty-two years who is 9 any of the following: 10 (1) Regularly attending an accredited school in pursuance 11 of a course of study leading to a high school diploma or its 12 equivalent. 13 (2) Regularly attending a course of vocational-technical 14 training either as a part of a regular school program or under 15 special arrangements adapted to the individual person’s needs. 16 (3) Is, in good faith, a full-time student in a college, 17 university, or community college. 18 (4) Has been accepted for admission to a college, 19 university, or community college and the next regular term has 20 not yet begun. 21 c. Is a child of any age and dependent because of physical 22 or mental disability. 23 3. If an application for a support allowance has not 24 been filed within four months after service of the notice 25 by or on behalf of the child qualifying for an allowance 26 under subsection 2, the child shall be deemed to have waived 27 the right to an allowance under this section. A child who 28 qualifies for an allowance under this section or the guardian 29 for the child, if any, may waive the child’s right to such 30 an allowance by submitting an affidavit to the trustee 31 acknowledging receipt of notice and irrevocably waiving the 32 child’s right to an allowance under this section. 33 4. The opening of an estate for the settlor shall 34 terminate the right of a child to apply for an allowance from 35 -15- LSB 1053HC (8) 84 rh/rj 15/ 25

H.F. _____ the trustee of the settlor’s revocable trust or to receive 1 additional support payments from the trust unless the personal 2 representative consents to a continuation of support payments. 3 If an allowance has been paid from trust assets, the trustee 4 or trust beneficiaries shall have a right to be reimbursed 5 subject to court approval from the settlor’s estate for such 6 payment until the final report of the settlor’s estate has been 7 approved. 8 Sec. 22. Section 633A.4213, subsection 5, Code 2011, is 9 amended by striking the subsection and inserting in lieu 10 thereof the following: 11 5. a. If the trustee has refused, after written request, 12 to provide an accounting or other required notice under this 13 section to a qualified beneficiary, the court may do any of the 14 following: 15 (1) Order the trustee to comply with the trustee’s duties 16 under this section. 17 (2) Assess costs, including attorney fees, against the 18 trustee personally. 19 b. Except as provided in paragraph “a” , the only consequence 20 to a trustee’s failure to provide the required accounting or 21 notice is that the trustee shall not be able to rely upon the 22 statute of limitations under section 633A.4504. 23 Sec. 23. Section 633A.4504, Code 2011, is amended to read 24 as follows: 25 633A.4504 Limitation of action against trustee. 26 1. Unless previously barred by adjudication, consent, 27 or other limitation, a claim against a trustee for breach of 28 trust is barred as to a beneficiary who has received a final 29 account an accounting pursuant to section 633A.4213 or other 30 report that adequately disclosing discloses the existence 31 of the claim, unless a proceeding to assert the claim is 32 commenced within one year after the earlier of the receipt 33 of the accounting or report of the termination of the trust 34 relationship between the trustee and beneficiary . An account 35 -16- LSB 1053HC (8) 84 rh/rj 16/ 25

H.F. _____ accounting or report adequately discloses the existence of 1 a claim if it provides sufficient information so that the 2 beneficiary knows of the claim or reasonably should have 3 inquired into its existence. 4 2. For the purpose of subsection 1 , a beneficiary is 5 deemed to have received an account accounting or report in the 6 following instances: 7 a. In the case of an adult who is reasonably capable of 8 understanding the account accounting or report, if it is 9 received by the adult personally. 10 b. In the case of an adult who is not reasonably capable 11 of understanding the account accounting or report, if it is 12 received by the adult’s legal representative, including a 13 guardian ad litem or other person appointed for this purpose. 14 c. In the case of a minor, if it is received by the minor’s 15 guardian or conservator or, if the minor does not have a 16 guardian or conservator, if it is received by a parent of the 17 minor who does not have a conflict of interest. 18 3. Any claim for breach of trust against a trustee who has 19 presented a final an accounting or report to a beneficiary more 20 than one year prior to July 1, 2000 2011 , shall be time barred 21 unless some exception stated in this section applies which 22 tolls the statute. Any claim arising under this section within 23 one year of July 1, 2000 2011 , shall be time barred after one 24 year unless an exception applies to toll the statute. 25 4. For the purposes of this section, “report” means a 26 document including but not limited to a letter, delivered by or 27 on behalf of the trustee to a beneficiary of the trust. 28 Sec. 24. NEW SECTION . 633A.4606 Interest as general 29 partner. 30 1. Except as otherwise provided in subsection 3 or unless 31 personal liability is imposed in the contract, a trustee who 32 holds an interest as a general partner in a general or limited 33 partnership is not personally liable on a contract entered 34 into by the partnership after the trust’s acquisition of 35 -17- LSB 1053HC (8) 84 rh/rj 17/ 25

H.F. _____ the interest if the fiduciary capacity was disclosed in the 1 contract or in a statement previously filed pursuant to section 2 486A.303 or 488.201. 3 2. Except as otherwise provided in subsection 3, a 4 trustee who holds an interest as a general partner is not 5 personally liable for torts committed by the partnership or for 6 obligations arising from ownership or control of the interest 7 unless the trustee is personally at fault. 8 3. The immunity provided by this section does not apply 9 if an interest in the partnership is held by the trustee in a 10 capacity other than that of trustee or is held by the trustee’s 11 spouse or one or more of the trustee’s descendants, siblings, 12 or parents, or the spouse of any of the trustee’s descendants, 13 siblings, or parents. 14 4. If the trustee of a revocable trust holds an interest as 15 a general partner, the settlor shall be personally liable for 16 contracts and other obligations of the partnership as if the 17 settlor were a general partner. 18 Sec. 25. Section 633C.2, Code 2011, is amended to read as 19 follows: 20 633C.2 Disposition of medical assistance special needs 21 trusts. 22 Regardless of the terms of a medical assistance special 23 needs trust, any income received or asset added to the trust 24 during a one-month period shall be expended as provided for 25 medical assistance income trusts under section 633C.3 , on 26 a monthly basis, during the life of the beneficiary. Any 27 increase in income or principal retained in the trust from 28 a previous month may be expended, during the life of the 29 beneficiary, only for reasonable and necessary expenses of the 30 trust, not to exceed ten fifty dollars per month without court 31 approval, for special needs of the beneficiary attributable 32 to the beneficiary’s disability and approved by the district 33 court, for medical care or services that would otherwise 34 be covered by medical assistance under chapter 249A , or to 35 -18- LSB 1053HC (8) 84 rh/rj 18/ 25