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--- version:6242S.01I - Introduced+++ version:Senate Committee Substitute - Committee Version@@ -1,3245 +1,4357 @@-EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted-and is intended to be omitted in the law.-SECOND REGULAR SESSION+6242S.04C+ 1+SENATE COMMITTEE SUBSTITUTE+FORSENATE BILL NO. 1468-103RD GENERAL ASSEMBLY-INTRODUCED BY SENATOR BURGER.-6242S.01I KRISTINA MARTIN, SecretaryAN ACT-To repeal sections 214.330, 456.4 -420, 469.401, 469.402, 469.403, 469.405, 469.409, 469.411,-469.413, 469.415, 469.417, 469.419, 469.421, 469.423, 469.425, 469.427, 469.429,-469.431, 469.432, 469.433, 469.435, 469.437, 469.439, 469.441, 469.443, 469.445,-469.447, 469.449, 469.451, 469.453, 469.455, 469.457, 469.459, 469.461, 469.463,-469.465, 469.467, 513.430, and 536.085, RSMo, and to enact in lieu thereof fifty -one-new sections relating to civil jurisprudence.+To repeal sections 82.1025, 214.330, 452.335,+452.375, 452.410, 452.423, 456.4 -420, 469.401,+469.402, 469.403, 469.405, 469.409, 469.411, 469.413,+469.415, 469.417, 469.419, 469.421, 469.423, 469.425,+469.427, 469.429, 469.431, 469.432, 469.433, 469.435,+469.437, 469.439, 469.441, 469.443, 469.445, 469.447,+469.449, 469.451, 469.453, 469.455, 469.457, 469.459,+469.461, 469.463, 469.465, 469.467, 488.426, 513.430,+536.085, and 537.528, RSMo, and to enact in lieu+thereof fifty -nine new sections relating to ci vil+jurisprudence, with penalty provisions.Be it enacted by the General Assembly of the State of Missouri, as follows:- Section A. Sections 214.330, 456.4-420, 469.401, 469.402, 1-469.403, 469.405, 469.409, 469.411, 469.413, 469.415, 469.417, 2-469.419, 469.421, 469.423, 469.425, 469.427, 469.429, 469.431, 3-469.432, 469.433, 469.435, 469.437, 469.439, 469.441, 469.443, 4-469.445, 469.447, 469.449, 469.451, 469.453, 469.455, 469.457, 5-469.459, 469.461, 469.463, 469.465, 469.467, 513.430, and 6-536.085, RSMo, are repealed and fifty-one new sections enacted 7-in lieu thereof, to be known as sections 214.330, 456.4 -420, 8-469.399, 469.401, 469.402, 469.403, 469.404, 469.405, 469.413, 9-469.415, 469.417, 469.419, 469.421, 469.423, 469.425, 469.427, 10-469.429, 469.431, 469.432, 469.433, 469.435, 469.437, 469.439, 11-469.441, 469.443, 469.445, 469.446, 469.447, 469.449, 469.451, 12-469.453, 469.455, 469.456, 469.457, 469.459, 469.462, 469.463, 13-469.464, 469.465, 469.467, 469.471, 469.473, 469.475, 469.477, 14-469.479, 469.481, 469.483, 469.485, 469.487, 513.430, and 15-536.085, to read as follows:16- SB 1468 2- 214.330. 1. (1) The endowed care trust fund required 1-by sections 214.270 to 214.410 shall be permanently set 2-aside in trust or in accordance with the provisions of 3-subsection 2 of this section. The trustee of the endowed 4-care trust shall be a state or federally chartered financial 5-institution authorized to exercise trust powers in 6-Missouri. The contact information for a trust officer or 7-duly appointed representative of the trustee with knowledge 8-and access to the trust fund accounting and trust fund 9-records must be disclosed to the office or its duly 10-authorized representative upon request. 11- (2) The trust fund records, including all trust fund 12-accounting records, shall be maintained in the state of 13-Missouri at all times or shall be electronically stored so 14-that the records may be made available in the state of 15-Missouri within fifteen business days of receipt of a 16-written request. The operator of an endowed care cemetery 17-shall maintain a current name and address of the trustee and 18-the records custodian for the endowed care trust fund and 19-shall supply such information to the office, or its 20-representative, upon request. 21- (3) Missouri law shall control all endowed care trust 22-funds and the Missouri courts shall have jurisdiction over 23-endowed care trusts regardless of where records may be kept 24-or various administrative tasks may be performed. 25- 2. An endowed care trust fund shall be administered in 26-accordance with Missouri law governing trusts, including but 27-not limited to the applicable provisions of chapters 456 and 28-469, except as specifically provided in this subsection or 29-where the provisions of sections 214.270 to 214.410 provide 30-differently, provided that a cemetery operator shall not in 31-any circumstances be authorized to restrict, enlarge, 32- SB 1468 3-change, or modify the requirements of this section or the 33-provisions of chapters 456 and 469 by agreement or otherwise. 34- (1) Income and principal of an endowed care trust fund 35-shall be determined under the provisions of law applicable 36-to trusts, except that the [provisions of section 469.405 37-shall not apply] trustee shall have: 38- (a) No power of adjustment under section 469.405; 39- (b) No power of conversion either from an income trust 40-to a unitrust or from a unitrust to an income trust under 41-section 469.475; 42- (c) No power or discretion to determine or modify the 43-unitrust rate, as established in the terms of the endowed 44-care trust agreement; and 45- (d) No discretion to determine applicable value for 46-purposes of computing the unitrust amount beyond that 47-granted by law and exercised solely for reasons of 48-administrative convenience and not affect the size of 49-distributions. 50-In determining applicable value under section 469.473, 51-values over a three-year period if available, or the 52-duration of the trust if shorter, shall be used. 53- (2) No principal shall be distributed from an endowed 54-care trust fund except to the extent that a unitrust 55-[election is in effect with respect to such trust under the 56-provisions of section 469.411] amount is required by the 57-terms of the endowed care trust fund agreement under 58-subdivision (6) of this subsection. 59- (3) No right to transfer jurisdiction from Missouri 60-under section 456.1-108 shall exist for endowed care trusts. 61- (4) All endowed care trusts shall be irrevocable. 62- SB 1468 4- (5) No trustee shall have the power to terminate an 63-endowed care trust fund under the provisions of section 64-456.4-414. 65- (6) A unitrust [election made in accordance with the 66-provisions of chapter 469] definition of income under 67-sections 469.471 to 469.487 shall be [made] established by 68-the cemetery operator in the terms of the endowed care trust 69-fund agreement itself, not by the trustee, and shall not 70-provide for a unitrust rate exceeding five percent per 71-annum. The unitrust rate shall be changed only by amendment 72-to the agreement as provided in this section. 73- (7) No contract of insurance shall be deemed a 74-suitable investment for an endowed care trust fund. 75- (8) The income from the endowed care fund may be 76-distributed to the cemetery operator at least annually on a 77-date designated by the cemetery operator by record, but no 78-later than sixty days following the end of the [trust fund] 79-trust's fiscal year. Any income not distributed within 80-sixty days following the end of the trust's fiscal year 81-shall be added to and held as part of the principal of the 82-trust fund. The cemetery operator may instruct by record 83-the trustee to distribute less than all the income 84-distributable for the year if the cemetery operator 85-determines that the money is not needed. 86- 3. The cemetery operator shall have the duty and 87-responsibility to apply the income distributed to provide 88-care and maintenance only for that part of the cemetery 89-designated as an endowed care section and not for any other 90-purpose. 91- 4. In addition to any other duty, obligation, or 92-requirement imposed by sections 214.270 to 214.410 or the 93-endowed care trust agreement, the trustee's duties shall be 94- SB 1468 5-the maintenance of records related to the trust and the 95-accounting for and investment of moneys deposited by the 96-operator to the endowed care trust fund. 97- (1) For the purposes of sections 214.270 to 214.410, 98-the trustee shall not be deemed responsible for the care, 99-the maintenance, or the operation of the cemetery, or for 100-any other matter relating to the cemetery, or the proper 101-expenditure of funds distributed by the trustee to the 102-cemetery operator, including, but not limited to, compliance 103-with environmental laws and regulations. 104- (2) With respect to cemetery property maintained by 105-endowed care funds, the cemetery operator shall be 106-responsible for the performance of the care and maintenance 107-of the cemetery property. 108- 5. If the endowed care cemetery fund is not 109-permanently set aside in a trust fund as required by 110-subsection 1 of this section, then the funds shall be 111-permanently set aside in an escrow account in the state of 112-Missouri. Funds in an escrow account shall be placed in an 113-endowed care trust fund under subsection 1 if the funds in 114-the escrow account exceed three hundred fifty thousand 115-dollars, unless otherwise approved by the division for good 116-cause. The account shall be insured by the Federal Deposit 117-Insurance Corporation or comparable deposit insurance and 118-held in a state or federally chartered financial institution 119-authorized to do business in Missouri and located in this 120-state. 121- (1) The interest from the escrow account may be 122-distributed to the cemetery operator at least in annual or 123-semiannual installments, but not later than six months 124-following the calendar year. Any interest not distributed 125-within six months following the end of the calendar year 126- SB 1468 6-shall be added to and held as part of the principal of the 127-account. 128- (2) The cemetery operator shall have the duty and 129-responsibility to apply the interest to provide care and 130-maintenance only for that part of the cemetery in which 131-burial space shall have been sold and with respect to which 132-sales the escrow account shall have been established and not 133-for any other purpose. The principal of such funds shall be 134-kept intact. The cemetery operator's duties shall be the 135-maintenance of records and the accounting for an investment 136-of moneys deposited by the operator to the escrow account. 137-For purposes of sections 214.270 to 214.410, the 138-administrator of the office of endowed care cemeteries shall 139-not be deemed to be responsible for the care, maintenance, 140-or operation of the cemetery. With respect to cemetery 141-property maintained by cemetery care funds, the cemetery 142-operator shall be responsible for the performance of the 143-care and maintenance of the cemetery property owned by the 144-cemetery operator. 145- (3) The division may approve an escrow agent if the 146-escrow agent demonstrates the knowledge, skill, and ability 147-to handle escrow funds and financial transactions and is of 148-good moral character. 149- 6. The cemetery operator shall be accountable to the 150-owners of burial space in the cemetery for compliance with 151-sections 214.270 to 214.410. 152- 7. Excluding funds held in an escrow account, all 153-endowed care trust funds shall be administered in accordance 154-with an endowed care trust fund agreement, which shall be 155-submitted to the office by the cemetery operator for review 156-and approval. The endowed care cemetery shall be notified 157-in writing by the office of endowed care cemeteries 158- SB 1468 7-regarding the approval or disapproval of the endowed care 159-trust fund agreement and regarding any changes required to 160-be made for compliance with sections 214.270 to 214.410 and 161-the rules and regulations promulgated thereunder. 162- 8. All endowed care cemeteries shall be under a 163-continuing duty to file with the office of endowed care 164-cemeteries and to submit for prior approval any and all 165-changes, amendments, or revisions of the endowed care trust 166-fund agreement at least thirty days before the effective 167-date of such change, amendment, or revision. 168- 9. If the endowed care trust fund agreement, or any 169-changes, amendments, or revisions filed with the office, are 170-not disapproved by the office within thirty days after 171-submission by the cemetery operator, the endowed care trust 172-fund agreement, or the related change, amendment, or 173-revision, shall be deemed approved and may be used by the 174-cemetery operator and the trustee. Notwithstanding any 175-other provision of this section, the office may review and 176-disapprove an endowed care trust fund agreement, or any 177-submitted change, amendment, or revision, after the thirty 178-days provided herein or at any other time if the agreement 179-is not in compliance with sections 214.270 to 214.410 or the 180-rules promulgated thereunder. Notice of disapproval by the 181-office shall be in writing and delivered to the cemetery 182-operator and the trustee within ten days of disapproval. 183- 10. Funds in an endowed care trust fund or escrow 184-account may be commingled with endowed care funds for other 185-endowed care cemeteries, provided that the cemetery operator 186-and the trustee shall maintain adequate accounting records 187-of the disbursements, contributions, and income allocated 188-for each cemetery. 189- SB 1468 8- 11. By accepting the trusteeship of an endowed care 190-trust or accepting funds as an escrow agent pursuant to 191-sections 214.270 to 214.410, the trustee or escrow agent 192-submits personally to the jurisdiction of the courts of this 193-state and the office of endowed care cemeteries regarding 194-the administration of the trust or escrow account. A 195-trustee or escrow agent shall consent in writing to the 196-jurisdiction of the state of Missouri and the office in 197-regards to the trusteeship or the operation of the escrow 198-account and to the appointment of the office of secretary of 199-state as its agent for service of process regarding any 200-administrative or legal actions relating to the trust or the 201-escrow account, if it has no designated agent for service of 202-process located in this state. Such consent shall be filed 203-with the office prior to accepting funds pursuant to 204-sections 214.270 to 214.410 as trustee or as an escrow agent 205-on a form provided by the office by rule. 206- 456.4-420. 1. If a trust instrument containing a no- 1-contest clause is or has become irrevocable, an interested 2-person may file a petition to the court for [an 3-interlocutory] a determination whether a particular [motion, 4-petition, or other] claim for relief by the interested 5-person would trigger application of the no-contest clause 6-[or would otherwise trigger a forfeiture] that is 7-enforceable under applicable law and public policy. 8- 2. The petition described in subsection 1 of this 9-section shall be verified under oath. The petition [may] 10-shall be filed by an interested person either as a separate 11-judicial proceeding, or brought with other claims for relief 12-in a single judicial proceeding, all in the manner 13-prescribed generally for such proceedings under this 14-chapter. If a petition is joined with other claims for 15- SB 1468 9-relief, the interested person shall seek, and the court 16-shall enter, its order or judgment on the petition before 17-proceeding any further with [any other claim for relief 18-joined therein] the matter. In ruling on such a petition, 19-the court shall consider the text of the clause, the context 20-to the terms of the trust instrument as a whole, and in the 21-context of the verified factual allegations in the 22-petition. No evidence beyond the pleadings and the trust 23-instrument shall be taken except as required to resolve an 24-ambiguity in the no-contest clause. 25- 3. An order or judgment [determining a petition] 26-making a determination described in subsection 1 of this 27-section shall have the effect set forth in subsections 4 and 28-5 of this section, and shall be subject to appeal as with 29-other final judgments. [If the] An order that disposes of 30-fewer than all claims for relief in a [judicial] 31-proceeding[, that order] under this section is subject to 32-[interlocutory] immediate appeal in accordance with the 33-applicable rules for taking such an appeal. If an 34-[interlocutory] appeal is taken, the court may stay the 35-pending judicial proceeding until final disposition of said 36-appeal on such terms and conditions as the court deems 37-reasonable and proper under the circumstances. A final 38-ruling on the applicability of a no-contest clause shall not 39-preclude any later filing and adjudication of other claims 40-related to the trust. 41- 4. An order or judgment, in whole or in part, on a 42-petition described in subsection 1 of this section shall 43-result in the no-contest clause being enforceable to the 44-extent of the court's ruling, and shall govern application 45-of the no-contest clause to the extent that the interested 46-person then proceeds forward with the claims described 47- SB 1468 10-therein. In the event such an [interlocutory] order or 48-judgment is vacated, reversed, or otherwise modified on 49-appeal, no interested person shall be prejudiced by any 50-reliance, through action, inaction, or otherwise, on the 51-order or judgment prior to final disposition of the appeal. 52- 5. An order or judgment shall have effect [only] as to 53-the claims, specific trust terms, and factual basis recited 54-in the petition, and shall relate to all actions taken by 55-all parties in the suit under the Missouri supreme court 56-rules of civil procedure and this chapter. If claims are 57-later filed or amended that are materially different than 58-those upon which the order or judgment is based, then to the 59-extent such new claims are raised, the party in whose favor 60-the order or judgment was entered shall have no protection 61-from enforcement of the no-contest clause otherwise afforded 62-by the order and judgment entered under this section. 63- 6. For purposes of this section, a "no-contest clause" 64-shall mean a provision in a trust instrument purporting to 65-rescind a donative transfer to, or a fiduciary appointment 66-of, any person, or that otherwise effects a forfeiture of 67-some or all of an interested person's beneficial interest in 68-a trust estate as a result of some action taken by the 69-beneficiary. This definition shall not be construed in any 70-way as determining whether a no-contest clause is 71-enforceable under applicable law and public policy in a 72-particular factual situation. As used in this section, the 73-term "no-contest clause" shall also mean an "in terrorem 74-clause". 75- 7. A no-contest clause is not enforceable against an 76-interested person in[, but not limited to,] the following 77-circumstances: 78- SB 1468 11- (1) Filing a motion, petition, or other claim for 79-relief objecting to the jurisdiction or venue of the court 80-over a proceeding concerning a trust, or over any person 81-joined, or attempted to be joined, in such a proceeding; 82- (2) Filing a motion, petition, or other claim for 83-relief concerning an accounting, report, or notice that has 84-or should have been made by a trustee, provided the 85-interested person otherwise has standing to do so under 86-applicable law, including, but not limited to, section 456.6- 87-603; 88- (3) Filing a motion, petition, or other claim for 89-relief under chapter 475 concerning the appointment of a 90-guardian or conservator for the settlor; 91- (4) Filing a motion, petition, or other claim for 92-relief under chapter 404 concerning the settlor; 93- (5) Disclosure to any person of information concerning 94-a trust instrument or that is relevant to a proceeding 95-before the court concerning the trust instrument or property 96-of the trust estate, unless such disclosure is otherwise 97-prohibited by law; 98- (6) Filing a motion, pleading, or other claim for 99-relief seeking approval of a nonjudicial settlement 100-agreement concerning a trust instrument, as set forth in 101-section 456.1-111; 102- (7) [To the extent] Filing a petition [under 103-subsection 1 of] pursuant to this section, provided the 104-petition is limited to the [procedure] procedures and 105-[purpose] purposes described [therein] in this section; 106- (8) Participation in a suit consistent with the 107-Missouri supreme court rules of civil procedure by any 108-interested person where the interested person has not 109-asserted any affirmative claim for relief; 110- SB 1468 12- (9) As to the interested persons party to an action, 111-to the extent the court determines that the application of 112-the no-contest clause is void or unenforceable as against 113-the public policy of this state; 114- (10) The scope of the no-contest clause does not 115-include the factual allegations of the petition as they 116-apply to the specific terms of the trust; and 117- (11) A no-contest clause that seeks to cause a 118-forfeiture against a beneficiary challenging a trust term 119-that would otherwise be prohibited under subsection 2 of 120-section 456.1-105 or section 456.10-1008. 121- 8. An interested person that does not seek a 122-determination in accordance with the provisions of this 123-section is not thereafter prohibited in any manner from 124-challenging the validity or application of a no-contest 125-clause in a proceeding without the protections afforded by 126-this section. 127- 9. In any proceeding brought under this section, the 128-court may award costs, expenses, and attorneys' fees to any 129-party, as provided in section 456.10-1004. 130- 469.399. Sections 469.399 to 469.487 shall be known 1-and may be cited as the "Missouri Uniform Fiduciary Income 2-and Principal Act". 3- 469.401. As used in sections [469.401] 469.399 to 1-[469.467] 469.487, the following terms mean: 2- (1) "Accounting period", a calendar year, unless 3-[another twelve-month period is selected by] a fiduciary 4-selects another period of twelve calendar months or 5-approximately twelve calendar months. The term "accounting 6-period" includes a [portion] part of a calendar year or 7-[other twelve-month] another period [that] of twelve 8-calendar months or approximately twelve calendar months that 9- SB 1468 13-begins when an income interest begins or ends when an income 10-interest ends; 11- (2) "Asset-backed security", a security that is 12-serviced primarily by the cash flows of a discrete pool of 13-fixed or revolving receivables or other financial assets 14-that by their terms convert into cash within a finite time. 15-The term "asset-backed security" includes rights or other 16-assets that ensure the servicing or timely distribution of 17-proceeds to the holder of the asset-backed security. The 18-term "asset-backed security" does not include an asset to 19-which section 469.423, 469.437, or 469.447 applies; 20- (3) "Beneficiary", includes: 21- (a) For a trust: 22- a. A current beneficiary, including a current income 23-beneficiary and a beneficiary that may receive only 24-principal; 25- b. A remainder beneficiary; and 26- c. Any other successor beneficiary; 27- (b) For an estate, an heir, legatee, and devisee [of a 28-decedent's estate, and an income beneficiary and a remainder 29-beneficiary of a trust, including any type of entity that 30-has a beneficial interest in either an estate or a trust]; 31-and 32- (c) For a life estate or term interest, a person that 33-holds a life estate, term interest, or remainder or other 34-interest following a life estate or term interest; 35- (4) "Court", any court in this state having 36-jurisdiction relating to a trust, estate, life estate, or 37-other term interest described in subdivision (2) of 38-subsection 1 of section 469.402; 39- (5) "Current income beneficiary", a beneficiary to 40-which a fiduciary may distribute net income, whether or not 41- SB 1468 14-the fiduciary also may distribute principal to the 42-beneficiary; 43- (6) "Distribution", a payment or transfer by a 44-fiduciary to a beneficiary in the beneficiary's capacity as 45-a beneficiary, made under the terms of the trust, without 46-consideration other than the beneficiary's right to receive 47-the payment or transfer under the terms of the trust. The 48-terms "distribute", "distributed", and "distributee" have 49-corresponding meanings; 50- (7) "Estate", a decedent's estate. The term "estate" 51-includes the property of the decedent as the estate is 52-originally constituted and the property of the estate as it 53-exists at any time during administration; 54- [(3)] (8) "Fiduciary", includes a trustee, trust 55-protector determined under section 456.8-808, personal 56-representative, [trustee, executor, administrator, successor 57-personal representative, special administrator and any other 58-person performing substantially the same function] life 59-tenant, holder of a term interest, and person acting under a 60-delegation from a fiduciary. The term "fiduciary" includes 61-a person that holds property for a successor beneficiary 62-whose interest may be affected by an allocation of receipts 63-and expenditures between income and principal. If there are 64-two or more cofiduciaries, the term "fiduciary" includes all 65-cofiduciaries acting under the terms of the trust and 66-applicable law; 67- [(4)] (9) "Income", money or other property [that] a 68-fiduciary receives as current return from [a] principal 69-[asset, including a portion]. The term "income" includes a 70-part of receipts from a sale, exchange, or liquidation of a 71-principal asset, [as] to the extent provided in sections 72-469.423 to 469.449; 73- SB 1468 15- [(5) "Income beneficiary", a person to whom net income 74-of a trust is or may be payable; 75- (6)] (10) "Income interest", the right of [an] a 76-current income beneficiary to receive all or part of net 77-income, whether the terms of the trust require [it] the net 78-income to be distributed or authorize [it] the net income to 79-be distributed in the [trustee's] fiduciary's discretion. 80-The term "income interest" includes the right of a current 81-beneficiary to use property held by a fiduciary; 82- (11) "Independent person", a person that is not: 83- (a) For a trust: 84- a. A qualified beneficiary as defined in section 456.1- 85-103; 86- b. A settlor of the trust; or 87- c. An individual whose legal obligation to support a 88-beneficiary may be satisfied by a distribution from the 89-trust; 90- (b) For an estate, a beneficiary; 91- (c) A spouse, parent, brother, sister, or issue of an 92-individual described in paragraph (a) or (b) of this 93-subdivision; 94- (d) A corporation, partnership, limited liability 95-company, or other entity in which persons described in 96-paragraphs (a) to (c) of this subdivision, in the aggregate, 97-have voting control; or 98- (e) An employee of a person described in paragraph 99-(a), (b), (c), or (d) of this subdivision; 100- [(7)] (12) "Mandatory income interest", the right of 101-[an] a current income beneficiary to receive net income that 102-the terms of the trust require the fiduciary to distribute; 103- [(8)] (13) "Net income", [if section 469.411 applies 104-to the trust, the unitrust amount, or if section 469.411 105- SB 1468 16-does not apply to the trust,] the total [receipts allocated 106-to income] allocations during an accounting period to income 107-under the terms of a trust and sections 469.399 to 469.487 108-minus the disbursements [made from income during the same 109-period, plus or minus transfers pursuant to sections 469.401 110-to 469.467 to or from income] during the [same] accounting 111-period, other than distributions, allocated to income under 112-the terms of the trust and sections 469.399 to 469.487. To 113-the extent the trust is a unitrust under sections 469.471 to 114-469.487, the term "net income" means the unitrust amount 115-determined under sections 469.471 to 469.487. The term "net 116-income" includes an adjustment from principal to income 117-under section 469.405. The term "net income" does not 118-include an adjustment from income to principal under section 119-469.405; 120- [(9)] (14) "Person", an individual, [corporation, 121-business trust,] estate, trust, [partnership, limited 122-liability company, association, joint venture] business or 123-nonprofit entity, public corporation, government[,] or 124-governmental subdivision, agency, or instrumentality, 125-[public corporation] or [any] other legal [or commercial] 126-entity; 127- (15) "Personal representative", an executor, 128-administrator, successor personal representative, special 129-administrator, or person that performs substantially the 130-same function with respect to an estate under the law 131-governing the person's status; 132- [(10)] (16) "Principal", property held in trust for 133-distribution to [a remainder], production of income for, or 134-use by a current or successor beneficiary [when the trust 135-terminates]; 136- SB 1468 17- [(11) "Qualified beneficiary", a beneficiary defined 137-in section 456.1-103; 138- (12) "Remainder beneficiary", a person entitled to 139-receive principal when an income interest ends; 140- (13)] (17) "Record", information that is inscribed on 141-a tangible medium or that is stored in an electronic or 142-other medium and is retrievable in perceivable form; 143- (18) "Settlor", a person, including a testator, that 144-creates or contributes property to a trust. If more than 145-one person creates or contributes property to a trust, the 146-term "settlor" includes each person, to the extent of the 147-trust property attributable to that person's contribution, 148-except to the extent another person has the power to revoke 149-or withdraw that portion; 150- (19) "Special tax benefit": 151- (a) Exclusion of a transfer to a trust from gifts 152-described in 26 U.S.C. Section 2503(b), as amended, because 153-of the qualification of an income interest in the trust as a 154-present interest in property; 155- (b) Status as a qualified subchapter S trust described 156-in 26 U.S.C. Section 1361(d)(3), as amended, at a time the 157-trust holds stock of an S corporation described in 26 U.S.C. 158-Section 1361(a)(1), as amended; 159- (c) An estate or gift tax marital deduction for a 160-transfer to a trust under 26 U.S.C. Section 2056 or 2523, as 161-amended, which depends or depended in whole or in part on 162-the right of the settlor's spouse to receive the net income 163-of the trust; 164- (d) Exemption in whole or in part of a trust from the 165-federal generation-skipping transfer tax imposed by 26 166-U.S.C. Section 2601, as amended, because the trust was 167- SB 1468 18-irrevocable on September 25, 1985, if there is any 168-possibility that: 169- a. A taxable distribution, as defined in 26 U.S.C. 170-Section 2612(b), as amended, could be made from the trust; or 171- b. A taxable termination, as defined in 26 U.S.C. 172-Section 2612(a), as amended, could occur with respect to the 173-trust; or 174- (e) An inclusion ratio, as defined in 26 U.S.C. 175-Section 2642(a), as amended, of the trust which is less than 176-one, if there is any possibility that: 177- a. A taxable distribution, as defined in 26 U.S.C. 178-Section 2612(b), as amended, could be made from the trust; or 179- b. A taxable termination, as defined in 26 U.S.C. 180-Section 2612(a), as amended, could occur with respect to the 181-trust; 182- (20) "Successive interest", the interest of a 183-successor beneficiary; 184- (21) "Successor beneficiary", a person entitled to 185-receive income or principal or to use property when an 186-income interest or other current interest ends; 187- (22) "Terms of a trust": 188- (a) Except as otherwise provided in paragraph (b) of 189-this subdivision, the manifestation of the settlor's [or 190-decedent's] intent regarding a trust's provisions as: 191- a. Expressed in [a manner which is] the trust 192-instrument; or 193- b. Established by other evidence that would be 194-admissible [as proof] in a judicial proceeding[, whether by 195-written or spoken words or by conduct]; 196- (b) The trust's provisions as established, determined, 197-or amended by: 198- SB 1468 19- a. A trustee or trust director in accordance with 199-applicable law; 200- b. Court order; or 201- c. A nonjudicial settlement agreement under section 202-456.1-111; 203- (c) For an estate, a will; or 204- (d) For a life estate or term interest, the 205-corresponding manifestation of the rights of the 206-beneficiaries; 207- (23) "Trust": 208- (a) Includes: 209- a. An express trust, private or charitable, with 210-additions to the trust, wherever and however created; and 211- b. A trust created or determined by judgment or decree 212-under which the trust is to be administered in the manner of 213-an express trust; and 214- (b) Does not include: 215- a. A constructive trust; 216- b. A resulting trust, conservatorship, guardianship, 217-multi-party account, custodial arrangement for a minor, 218-business trust, voting trust, security arrangement, 219-liquidation trust, or trust for the primary purpose of 220-paying debts, dividends, interest, salaries, wages, profits, 221-pensions, retirement benefits, or employee benefits of any 222-kind; or 223- c. An arrangement under which a person is a nominee, 224-escrowee, or agent for another; 225- [(14)] (24) "Trustee", a person, other than a personal 226-representative, that owns or holds property for the benefit 227-of a beneficiary. The term "trustee" includes an original, 228-additional, or successor trustee, whether or not appointed 229-or confirmed by a court; 230- SB 1468 20- [(15) "Unitrust amount", net income as defined by 231-section 469.411] 232- (25) "Will", any testamentary instrument recognized by 233-applicable law that makes a legally effective disposition of 234-an individual's property, effective at the individual's 235-death. The term "will" includes a codicil or other 236-amendment to a testamentary instrument. 237- 469.402. 1. Except as otherwise provided in the terms 1-of a trust or sections 469.399 to 469.487, the provisions of 2-sections [456.3-301] 469.399 to [456.3-305 shall] 469.487 3-apply to [sections 469.401 to 469.467 for all purposes]: 4- (1) A trust or estate; and 5- (2) A life estate or other term interest in which the 6-interest of one or more persons will be succeeded by the 7-interest of one or more other persons. 8- 2. Except as otherwise provided in the terms of a 9-trust or sections 469.399 to 469.487, the provisions of 10-sections 469.399 to 469.487 apply when this state is the 11-principal place of administration of a trust or estate or 12-the situs of property that is not held in a trust or estate 13-and is subject to a life estate or other term interest 14-described in subdivision (2) of subsection 1 of this 15-section. By accepting the trusteeship of a trust having its 16-principal place of administration in this state or by moving 17-the principal place of administration of a trust to this 18-state, the trustee submits to the application of sections 19-469.399 to 469.487 to any matter within the scope of 20-sections 469.399 to 469.487 involving the trust. 21- 469.403. 1. In [allocating receipts and disbursements 1-to or between principal and income, and with respect to any 2-matter within the scope of] making an allocation or 3- SB 1468 21-determination or exercising discretion under sections 4-469.413 to 469.421, a fiduciary shall: 5- (1) [Shall] Act in good faith, based on what is fair 6-and reasonable to all beneficiaries; 7- (2) Administer a trust or estate [under] impartially, 8-except to the extent the terms of the trust manifest an 9-intent that the fiduciary shall or [the will] may favor one 10-or more beneficiaries; 11- (3) Administer the trust or estate in accordance with 12-the terms of the trust, even if there is a different 13-provision in sections [469.401] 469.399 to [469.467] 14-469.487; and 15- [(2) May] (4) Administer [a] the trust or estate [by 16-exercising] in accordance with sections 469.399 to 469.487, 17-except to the extent the terms of the trust provide 18-otherwise or authorize the fiduciary to determine otherwise. 19- 2. A fiduciary's allocation, determination, or 20-exercise of discretion pursuant to sections 469.399 to 21-469.487 is presumed to be fair and reasonable to all 22-beneficiaries. A fiduciary may exercise a discretionary 23-power of administration given to the fiduciary by the terms 24-of the trust [or the will, even if the], and an exercise of 25-the power that produces a result different from a result 26-required or permitted by sections [469.401] 469.399 to 27-[469.467;] 469.487 does not create an inference that the 28-fiduciary abused the fiduciary's discretion. 29- [(3) Shall administer a trust or estate pursuant] 30- 3. A fiduciary shall: 31- (1) Add a receipt to [sections 469.401 to 469.467 if] 32-principal, to the extent neither the terms of the trust [or 33-the will do not contain a different provision or do not 34-give] nor sections 469.399 to 469.487 allocate the 35- SB 1468 22-[fiduciary a discretionary power of administration] receipt 36-between income and principal; and 37- [(4) Shall add a receipt or] (2) Charge a 38-disbursement to principal, to the extent [that] neither the 39-terms of the trust [and] nor sections [469.401] 469.399 to 40-[469.467 do not provide a rule for allocating the receipt 41-or] 469.487 allocate the disbursement [to or] between 42-[principal and] income and principal. 43- [2. In exercising the power to adjust pursuant to 44-section 469.405 or a discretionary power of administration 45-regarding a matter within the scope of sections 469.401 to 46-469.467, whether granted by the terms of a trust, a will, or 47-sections 469.401 to 469.467, a fiduciary shall administer a 48-trust or estate impartially, based on what is fair and 49-reasonable to all of the beneficiaries, except to the extent 50-that the terms of the trust or the will clearly manifest an 51-intent that the fiduciary shall or may favor one or more of 52-the beneficiaries. A determination in accordance with 53-sections 469.401 to 469.467 is presumed to be fair and 54-reasonable to all of the beneficiaries] 55- 4. A fiduciary may exercise the power to adjust under 56-section 469.405, convert an income trust to a unitrust under 57-subdivision (1) of subsection 1 of section 469.475, change 58-the percentage or method used to calculate a unitrust amount 59-under subdivision (2) of subsection 1 of section 469.475, or 60-convert a unitrust to an income trust under subdivision (3) 61-of subsection 1 of section 469.475, if the fiduciary 62-determines the exercise of the power will assist the 63-fiduciary to administer the trust or estate impartially. 64- 5. Factors the fiduciary shall consider in making the 65-determination under subsection 4 of this section include: 66- (1) The terms of the trust; 67- SB 1468 23- (2) The nature, distribution standards, and expected 68-duration of the trust; 69- (3) The effect of the allocation rules, including 70-specific adjustments between income and principal, under 71-sections 407.413 to 407.461; 72- (4) The desirability of liquidity and regularity of 73-income; 74- (5) The desirability of the preservation and 75-appreciation of principal; 76- (6) The extent to which an asset is used or may be 77-used by a beneficiary; 78- (7) The increase or decrease in the value of principal 79-assets, reasonably determined by the fiduciary; 80- (8) Whether and to what extent the terms of the trust 81-give the fiduciary power to accumulate income or invade 82-principal or prohibit the fiduciary from accumulating income 83-or invading principal; 84- (9) The extent to which the fiduciary has accumulated 85-income or invaded principal in preceding accounting periods; 86- (10) The effect of current and reasonably expected 87-economic conditions; and 88- (11) The reasonably expected tax consequences of the 89-exercise of the power. 90- 469.404. 1. As used in this section, the term 1-"fiduciary decision" means: 2- (1) A fiduciary's allocation between income and 3-principal or other determination regarding income and 4-principal required or authorized by the terms of the trust 5-or sections 469.399 to 469.487; 6- (2) The fiduciary's exercise or nonexercise of a 7-discretionary power regarding income and principal granted 8-by the terms of the trust or sections 469.399 to 469.487, 9- SB 1468 24-including the power to adjust under section 469.405, convert 10-an income trust to a unitrust under subdivision (1) of 11-subsection 1 of section 469.475, change the percentage or 12-method used to calculate a unitrust amount under subdivision 13-(2) of subsection 1 of section 469.475, or convert a 14-unitrust to an income trust under subdivision (3) of 15-subsection 1 of section 469.475; or 16- (3) The fiduciary's implementation of a decision 17-described in subdivision (1) or (2) of this subsection. 18- 2. The court shall not order a fiduciary to change a 19-fiduciary decision unless the court determines that the 20-fiduciary decision was an abuse of the fiduciary's 21-discretion. 22- 3. If the court determines that a fiduciary decision 23-was an abuse of the fiduciary's discretion, the court may 24-order a remedy authorized by law, including under section 25-456.10-1001. To place the beneficiaries in the positions 26-the beneficiaries would have occupied if there had not been 27-an abuse of the fiduciary's discretion, the court may order: 28- (1) The fiduciary to exercise or refrain from 29-exercising the power to adjust under section 469.405; 30- (2) The fiduciary to exercise or refrain from 31-exercising the power to convert an income trust to a 32-unitrust under subdivision (1) of subsection 1 of section 33-469.475, change the percentage or method used to calculate a 34-unitrust amount under subdivision (2) of subsection 1 of 35-section 469.475, or convert a unitrust to an income trust 36-under subdivision (3) of subsection 1 of section 469.475; 37- (3) The fiduciary to distribute an amount to a 38-beneficiary; 39- (4) A beneficiary to return some or all of a 40-distribution; or 41- SB 1468 25- (5) The fiduciary to withhold an amount from one or 42-more future distributions to a beneficiary. 43- 4. On petition by a fiduciary for instruction, the 44-court may determine whether a proposed fiduciary decision 45-will result in an abuse of the fiduciary's discretion. If 46-the petition describes the proposed decision, contains 47-sufficient information to inform the beneficiary of the 48-reasons for making the proposed decision and the facts on 49-which the fiduciary relies, and explains how the beneficiary 50-will be affected by the proposed decision, a beneficiary 51-that opposes the proposed decision has the burden to 52-establish that it will result in an abuse of the fiduciary's 53-discretion. 54- 469.405. 1. [A trustee may adjust between principal 1-and income to the extent the trustee considers necessary if 2-the trustee invests and manages trust assets as a prudent 3-investor, the terms of the trust describe the amount that 4-may or shall be distributed to a beneficiary by referring to 5-the trust's income, and the trustee determines, after 6-applying subsection 1 of section 469.403, that the trustee 7-is unable to comply with subsection 2 of section 469.403] 8-Except as otherwise provided in the terms of a trust or this 9-section, a fiduciary, in a record, without court approval, 10-may adjust between income and principal if the fiduciary 11-determines the exercise of the power to adjust will assist 12-the fiduciary to administer the trust or estate impartially. 13- 2. This section does not create a duty to exercise or 14-consider the power to adjust under subsection 1 of this 15-section or to inform a beneficiary about the applicability 16-of this section. 17- 3. A fiduciary that in good faith exercises or fails 18-to exercise the power to adjust under subsection 1 of this 19- SB 1468 26-section is not liable to a person affected by the exercise 20-or failure to exercise. 21- [2.] 4. In deciding whether and to what extent to 22-exercise the power [conferred by] to adjust under subsection 23-1 of this section, a [trustee] fiduciary shall consider all 24-factors the fiduciary considers relevant [to the trust and 25-its beneficiaries], including [the following] relevant 26-factors [to the extent relevant:] in subsection 5 of section 27-469.403 and the application of sections 469.423, 469.435, 28-and 469.445. 29- [(1) The nature, purpose and expected duration of the 30-trust; 31- (2) The intent of the settlor; 32- (3) The identity and circumstances of the 33-beneficiaries; 34- (4) The needs for liquidity, regularity of income, and 35-preservation and appreciation of capital; 36- (5) The assets held in the trust, including the extent 37-to which such assets consist of financial assets, interests 38-in closely held enterprises, tangible and intangible 39-personal property, or real property, and the extent to which 40-such assets are used by a beneficiary, and whether such 41-assets were purchased by the trustee or received from the 42-settlor; 43- (6) The net amount allocated to income pursuant to 44-sections 469.401 to 469.467, other than this section, and 45-the increase or decrease in the value of the principal 46-assets, which the trustee may estimate as to assets for 47-which market values are not readily available; 48- (7) Whether and to what extent the terms of the trust 49-give the trustee the power to invade principal or accumulate 50-income, or prohibit the trustee from invading principal or 51- SB 1468 27-accumulating income, and the extent to which the trustee has 52-exercised a power from time to time to invade principal or 53-accumulate income; 54- (8) The actual and anticipated effect of economic 55-conditions on principal and income and effects of inflation 56-and deflation; and 57- (9) The anticipated tax consequences of an adjustment. 58- 3.] 5. A [trustee may] fiduciary shall not exercise 59-the power under subsection 1 of this section to make an 60-adjustment or under section 469.435 to make a determination 61-that an allocation is insubstantial if: 62- (1) [That diminishes the income interest in a trust 63-which requires all of the income to be paid at least 64-annually to a spouse and for which an estate tax or gift tax 65-marital deduction would be allowed, in whole or in part, if 66-the trustee did not have the power to make the adjustment; 67- (2) That reduces the actuarial value of the income 68-interest in a trust to which a person transfers property 69-with the intent to qualify for a gift tax exclusion; 70- (3) That changes] The adjustment or determination 71-would reduce the amount payable to a current income 72-beneficiary from a trust that qualifies for a special tax 73-benefit, except to the extent the adjustment is made to 74-provide for a reasonable apportionment of the total return 75-of the trust between the current income beneficiary and 76-successor beneficiaries; 77- (2) The adjustment or determination would change the 78-amount payable to a beneficiary, as a fixed annuity or a 79-fixed fraction of the value of the trust assets, under the 80-terms of the trust; 81- [(4) From any] (3) The adjustment or determination 82-would reduce an amount that is permanently set aside for a 83- SB 1468 28-charitable [purposes] purpose under [a will or] the terms of 84-[a] the trust [to the extent that the existence of the power 85-to adjust would change the character of the amount], unless 86-both income and principal are set aside for [federal income, 87-gift or estate tax purposes] the charitable purpose; 88- [(5) If ] (4) Possessing or exercising the power [to 89-make an adjustment causes an individual] would cause a 90-person to be treated as the owner of all or part of the 91-trust for federal income tax purposes[, and the individual 92-would not be treated as the owner if the trustee did not 93-possess the power to make an adjustment]; 94- [(6) If ] (5) Possessing or exercising the power [to 95-make an adjustment causes] would cause all or part of the 96-value of the trust assets to be included [for estate tax 97-purposes] in the gross estate of an individual [who has] for 98-federal estate tax purposes; 99- (6) Possessing or exercising the power [to remove or 100-appoint a trustee, or both,] would cause an individual to be 101-treated as making a gift for federal gift tax purposes; 102- (7) The fiduciary is not an independent person; 103- (8) The trust is irrevocable and [the assets would not 104-be included in the estate of the individual if the trustee 105-did not possess] provides for income to be paid to the 106-settlor and possessing or exercising the power [to make an 107-adjustment] would cause the adjusted principal or income to 108-be considered an available resource or available income 109-under a public-benefit program; or 110- [(7) If the trustee is a beneficiary of the trust; or 111- (8) If the trustee is not a beneficiary, but the 112-adjustment would benefit the trustee directly or indirectly] 113- (9) The trust is a unitrust under sections 469.471 to 114-469.487. 115- SB 1468 29- [4.] 6. If [subdivision (5), (6), (7) or (8) of] 116-subsection [3] 5 of this section applies to a [trustee and 117-there is more than one trustee, a cotrustee to whom the 118-provision does] fiduciary: 119- (1) A cofiduciary to which subdivisions (4) to (7) of 120-subsection 5 of this section do not apply may [make] 121-exercise the [adjustment] power to adjust unless the 122-exercise of the power by the remaining [trustee or trustees] 123-cofiduciary or cofiduciaries is not permitted by the terms 124-of the trust or law other than sections 469.399 to 469.487; 125-and 126- (2) If there is no cofiduciary to which subdivisions 127-(4) to (7) of subsection 5 of this section do not apply, the 128-fiduciary may appoint a cofiduciary to which subdivisions 129-(4) to (7) of subsection 5 of this section do not apply, 130-which may be a special fiduciary with limited powers, and 131-the appointed cofiduciary may exercise the power to adjust 132-under subsection 1 of this section, unless the appointment 133-of a cofiduciary or the exercise of the power by a 134-cofiduciary is not permitted by the terms of the trust or 135-law other than under sections 469.399 to 469.487. 136- [5.] 7. A [trustee] fiduciary may release [the entire 137-power conferred by subsection 1 of this section, or may 138-release only] or delegate to a cofiduciary the power to 139-adjust [from income to principal or the power to adjust from 140-principal to income if the trustee is uncertain about 141-whether possessing or exercising] under subsection 1 of this 142-section if the fiduciary determines that the fiduciary's 143-possession or exercise of the power will or may: 144- (1) Cause a result described in subdivisions (1) to 145-(6) or subdivision (8) of subsection [3] 5 of this section 146- SB 1468 30-[,]; or [if the trustee determines that possessing or 147-exercising the power will or may] 148- (2) Deprive the trust of a tax benefit or impose a tax 149-burden not described in subdivisions (1) to (6) of 150-subsection [3] 5 of this section. [The release may be 151-permanent or for] 152- 8. A fiduciary's release or delegation to a 153-cofiduciary under subsection 7 of this section of the power 154-to adjust under subsection 1 of this section: 155- (1) Shall be in a record; 156- (2) Applies to the entire power, unless the release or 157-delegation provides a limitation, which may be a limitation 158-to the power to adjust: 159- (a) From income to principal; 160- (b) From principal to income; 161- (c) For specified property; or 162- (d) In specified circumstances; 163- (3) For a delegation, may be modified by a 164-redelegation under this subsection by the cofiduciary to 165-which the delegation is made; and 166- (4) Subject to subdivision (3) of this subsection, is 167-permanent unless the release or delegation provides a 168-specified period, including a period measured by the life of 169-an individual or the lives of more than one individual. 170- [6.] 9. Terms of a trust that deny or limit the power 171-[of a trustee] to [make an adjustment] adjust between income 172-and principal [and income] do not affect the application of 173-this section unless [it is clear from] the terms of the 174-trust [that the terms are intended to] expressly deny [the 175-trustee] or limit the power [of adjustment conferred by] to 176-adjust under subsection 1 of this section. 177- SB 1468 31- 10. The exercise of the power to adjust under 178-subsection 1 of this section in any accounting period may 179-apply to the current period, the immediately preceding 180-period, and one or more subsequent periods. 181- 11. A description of the exercise of the power to 182-adjust under subsection 1 of this section shall be: 183- (1) Included in a report, if any, sent to 184-beneficiaries under subsection 3 of section 456.8-813; or 185- (2) Communicated at least annually to the qualified 186-beneficiaries defined in section 456.1-103 other than all 187-beneficiaries that receive or are entitled to receive income 188-from the trust or would be entitled to receive a 189-distribution of principal if the trust were terminated at 190-the time the notice is sent, assuming no power of 191-appointment is exercised. 192- 469.413. [After a decedent dies, in the case] 1. This 1-section applies when: 2- (1) The death of an individual results in the creation 3-of an estate[, or after] or trust; or 4- (2) An income interest in a trust [ends, the following 5-rules apply:] terminates, whether the trust continues or is 6-distributed. 7- [(1)] 2. A fiduciary of an estate or [of a 8-terminating] trust with an income interest that terminates 9-shall determine, under subsection 7 of this section and 10-sections 469.417 to 469.462, the amount of net income and 11-net principal receipts received from property specifically 12-given to a beneficiary [pursuant to the rules in sections 13-469.417 to 469.461 which apply to trustees and the rules in 14-subdivision (5) of this section]. The fiduciary shall 15-distribute the net income and net principal receipts to the 16- SB 1468 32-beneficiary [who] that is to receive the specific 17-property[;]. 18- [(2)] 3. A fiduciary shall determine the [remaining] 19-income and net income of [a decedent's] an estate or [a 20-terminating] income interest [pursuant to the rules in] in a 21-trust that terminates, other than the amount of net income 22-determined under subsection 2 of this section, under 23-sections 469.417 to [469.461 which apply to trustees] 24-469.462 and by: 25- [(a)] (1) Including in net income all income from 26-property used or sold to discharge liabilities; 27- [(b)] (2) Paying from income or principal, in the 28-fiduciary's discretion, fees of attorneys, accountants, and 29-fiduciaries[;], court costs and other expenses of 30-administration[;], and interest on [death] estate and 31-inheritance taxes and other taxes imposed because of the 32-decedent's death, but the fiduciary may pay [those] the 33-expenses from income of property passing to a trust for 34-which the fiduciary claims [an] a federal estate tax marital 35-or charitable deduction only to the extent [that]: 36- (a) The payment of [those] the expenses from income 37-will not cause the reduction or loss of the deduction; [and] 38-or 39- (b) The fiduciary makes an adjustment under subsection 40-2 of section 469.462; and 41- [(c)] (3) Paying from principal [all] other 42-disbursements made or incurred in connection with the 43-settlement of [a decedent's] the estate or the winding up of 44-[a terminating] an income interest that terminates, 45-including: 46- (a) To the extent authorized by the decedent's will, 47-the terms of the trust, or applicable law, debts, funeral 48- SB 1468 33-expenses, disposition of remains, family allowances, estate 49-and [death] inheritance taxes, and other taxes imposed 50-because of the decedent's death; and 51- (b) Related penalties that are apportioned, by the 52-decedent's will, the terms of the trust, or applicable law, 53-to the estate or [terminating] income interest [by the will, 54-the terms of the trust, or applicable law; 55- (3) A fiduciary shall distribute to a beneficiary who 56-receives a pecuniary amount outright the interest or any 57-other amount provided by the will, the terms of the trust, 58-or in the absence of any such provisions, the provisions of 59-section 473.633, from net income determined pursuant to 60-subdivision (2) of this section or from principal to the 61-extent that net income is insufficient] that terminates. 62- 4. If a decedent's will, the terms of a trust, or 63-applicable law provides for the payment of interest or the 64-equivalent of interest to a beneficiary that receives a 65-pecuniary amount outright, the fiduciary shall make the 66-payment from net income determined under subsection 3 of 67-this section or from principal to the extent net income is 68-insufficient. 69- 5. If a beneficiary is to receive a pecuniary amount 70-outright from a trust after an income interest ends because 71-of an income beneficiary's death, and no payment of interest 72-or [other amount] the equivalent of interest is provided for 73-by the terms of the trust or applicable law, the fiduciary 74-shall [distribute] pay the interest or [other amount] the 75-equivalent of interest to which the beneficiary would be 76-entitled under applicable law if the pecuniary amount were 77-required to be paid under a will[;]. 78- [(4)] 6. A fiduciary shall distribute [the] net income 79-remaining after [distributions] payments required by 80- SB 1468 34-[subdivision (3)] subsections 4 and 5 of this section in the 81-manner described in section 469.415 to all other 82-beneficiaries, including a beneficiary [who] that receives a 83-pecuniary amount in trust, even if the beneficiary holds an 84-unqualified power to withdraw assets from the trust or other 85-presently exercisable general power of appointment over the 86-trust[;]. 87- [(5)] 7. A fiduciary [may] shall not reduce principal 88-or income receipts from property described in [subdivision 89-(1)] subsection 2 of this section because of a payment 90-described in sections 469.451 and 469.453 to the extent 91-[that] the decedent's will, the terms of the trust, or 92-applicable law requires the fiduciary to make the payment 93-from assets other than the property or to the extent [that] 94-the fiduciary recovers or expects to recover the payment 95-from a third party. The net income and principal receipts 96-from the property [are] shall be determined by including 97-[all of] the amounts the fiduciary receives or pays [with 98-respect to] regarding the property, whether [those amounts] 99-the amount accrued or became due before, on, or after the 100-date of [a] the decedent's death or an income interest's 101-terminating event, and [by] making a reasonable provision 102-for [amounts that the fiduciary believes] an amount the 103-estate or [terminating] income interest may become obligated 104-to pay after the property is distributed. 105- 469.415. 1. [Each] Except to the extent sections 1-469.471 to 469.487 apply for a beneficiary that is a trust, 2-each beneficiary described in [subdivision (4)] subsection 6 3-of section 469.413 is entitled to receive a [portion] share 4-of the net income equal to the beneficiary's fractional 5-interest in undistributed principal assets, using values as 6-of the distribution date. If a fiduciary makes more than 7- SB 1468 35-one distribution of assets to beneficiaries to [whom] which 8-this section applies, each beneficiary, including [one who] 9-a beneficiary that does not receive part of the 10-distribution, is entitled, as of each distribution date, to 11-a share of the net income the fiduciary [has] received after 12-the [date of] decedent's death [or], an income interest's 13-other terminating event, or [earlier] the preceding 14-distribution [date but has not distributed as of the current 15-distribution date] by the fiduciary. 16- 2. In determining a beneficiary's share of net income 17-under subsection 1 of this section, the following rules 18-apply: 19- (1) The beneficiary is entitled to receive a [portion] 20-share of the net income equal to the beneficiary's 21-fractional interest in the undistributed principal assets 22-immediately before the distribution date[, including assets 23-that later may be sold to meet principal obligations]; 24- (2) The beneficiary's fractional interest [in the 25-undistributed principal assets] under subdivision (1) of 26-this subsection shall be calculated [without regard to 27-property specifically given to a beneficiary and property 28-required to pay pecuniary amounts not in trust; 29- (3) The beneficiary's fractional interest in the 30-undistributed principal assets shall be calculated]: 31- (a) On the [basis of the] aggregate value of [those] 32-the assets as of the distribution date without reducing the 33-value by any unpaid principal obligation; and 34- (b) Without regard to: 35- a. Property specifically given to a beneficiary under 36-the decedent's will or the terms of the trust; and 37- b. Property required to pay pecuniary amounts not in 38-trust; and 39- SB 1468 36- [(4)] (3) The distribution date [for purposes of this 40-section] under subdivision (1) of this subsection may be the 41-date as of which the fiduciary calculates the value of the 42-assets if that date is reasonably near the date on which the 43-assets are [actually] distributed. 44- 3. [If] To the extent a fiduciary does not distribute 45-under this section all [of] the collected but undistributed 46-net income to each [person] beneficiary as of a distribution 47-date, the fiduciary shall maintain [appropriate] records 48-showing the interest of each beneficiary in [that] the net 49-income. 50- 4. If this section applies to income from an asset, a 51-fiduciary may apply the rules in this section[, to the 52-extent that the fiduciary considers it appropriate,] to net 53-gain or loss realized from the disposition of the asset 54-after the [date of] decedent's death [or], an income 55-interest's terminating event, or [earlier] the preceding 56-distribution [date from the disposition of a principal asset 57-if this section applies to the income from the asset] by the 58-fiduciary. 59- 469.417. 1. An income beneficiary is entitled to net 1-income in accordance with the terms of the trust from the 2-date [on which the] an income interest begins. [An] The 3-income interest begins on the date specified in the terms of 4-the trust or, if no date is specified, on the date an asset 5-becomes subject to [a trust or successive income interest]: 6- (1) The trust for the current income beneficiary; or 7- (2) A successive interest for a successor beneficiary. 8- 2. An asset becomes subject to a trust under 9-subdivision (1) of subsection 1 of this section: 10- (1) [On the date it is transferred to the trust in the 11-case of] For an asset that is transferred to [a] the trust 12- SB 1468 37-during the [transferor's] settlor's life, on the date the 13-asset is transferred; 14- (2) [On the date of a testator's death in the case of] 15-For an asset that becomes subject to [a] the trust [by 16-reason] because of a [will] decedent's death, on the date of 17-the decedent's death, even if there is an intervening period 18-of administration of the [testator's] decedent's estate; or 19- (3) [On the date of an individual's death in the case 20-of] For an asset that is transferred to a fiduciary by a 21-third party because of [the individual's] a decedent's 22-death, on the date of the decedent's death. 23- 3. An asset becomes subject to a successive [income] 24-interest under subdivision (2) of subsection 1 of this 25-section on the day after the preceding income interest ends, 26-as determined [pursuant to] under subsection 4 of this 27-section, even if there is an intervening period of 28-administration to wind up the preceding income interest. 29- 4. An income interest ends on the day before an income 30-beneficiary dies or another terminating event occurs[,] or 31-on the last day of a period during which there is no 32-beneficiary to [whom] which a [trustee] fiduciary may or 33-shall distribute income. 34- 469.419. 1. A [trustee] fiduciary shall allocate an 1-income receipt or disbursement, other than [one] a receipt 2-to which [subdivision (1)] subsection 2 of section 469.413 3-applies, to principal if its due date occurs before [a 4-decedent dies in the case of] the date on which: 5- (1) For an estate, the decedent died; or [before] 6- (2) For a trust or successive interest, an income 7-interest begins [in the case of a trust or successive income 8-interest]. 9- SB 1468 38- 2. [A trustee shall allocate an income receipt or 10-disbursement to income if its] If the due date of a periodic 11-income receipt or disbursement occurs on or after the date 12-on which a decedent [dies] died or an income interest 13-[begins and it is a periodic due date. An income] began, a 14-fiduciary shall allocate the receipt or disbursement to 15-income. 16- 3. If an income receipt or disbursement is not 17-periodic or has no due date, a fiduciary shall [be treated] 18-treat the receipt or disbursement under this section as 19-accruing from day to day [if its due date is not periodic or 20-it has no due date]. The fiduciary shall allocate to 21-principal the portion of the receipt or disbursement 22-accruing before the date on which a decedent [dies] died or 23-an income interest [begins shall be allocated to principal] 24-began, and to income the balance [shall be allocated to 25-income]. 26- [3.] 4. A receipt or disbursement is periodic under 27-subsections 2 and 3 of this section if: 28- (1) The receipt or disbursement shall be paid at 29-regular intervals under an obligation to make payments; or 30- (2) The payer customarily makes payments at regular 31-intervals. 32- 5. An item of income or [an] obligation is due under 33-this section on the date [a payment] the payer is required 34-to make a payment. If a payment date is not stated, there 35-is no due date [for the purposes of sections 469.401 to 36-469.467]. 37- 6. Distributions to shareholders or other owners from 38-an entity to which section 469.423 applies are [deemed to 39-be] due: 40- SB 1468 39- (1) On the date fixed by or on behalf of the entity 41-for determining [who is] the persons entitled to receive the 42-distribution [or,]; 43- (2) If no date is fixed, on the [declaration] date 44-[for] of the decision by or on behalf of the entity to make 45-the distribution[. A due date is periodic for receipts or 46-disbursements that shall be paid at regular intervals under 47-a lease or an obligation to pay interest or if an entity 48-customarily makes distributions at regular intervals]; or 49- (3) If no date is fixed and the fiduciary does not 50-know the date of the decision by or on behalf of the entity 51-to make the distribution, on the date the fiduciary learns 52-of the decision. 53- 469.421. 1. [For purposes of] As used in this 1-section, the [phrase] term "undistributed income" means net 2-income received on or before the date on which an income 3-interest ends. The [phrase] term "undistributed income" 4-does not include an item of income or expense that is due or 5-accrued[,] or net income that has been added or is required 6-to be added to principal under the terms of the trust. 7- 2. Except as otherwise provided in subsection 3 of 8-this section, when a mandatory income interest of a 9-beneficiary ends, the [trustee] fiduciary shall pay [to a 10-mandatory income beneficiary who survives that date, or the 11-estate of a deceased mandatory income beneficiary whose 12-death causes the interest to end,] the beneficiary's share 13-of the undistributed income that is not disposed of under 14-the terms of the trust [unless] to the beneficiary or, if 15-the beneficiary does not survive the date the interest ends, 16-to the beneficiary's estate. 17- 3. If a beneficiary has an unqualified power to 18-[revoke] withdraw more than five percent of the value of a 19- SB 1468 40-trust immediately before [the] an income interest ends[. In 20-the latter case,]: 21- (1) The fiduciary shall allocate to principal the 22-undistributed income from the portion of the trust that may 23-be [revoked shall be added to principal] withdrawn; and 24- (2) Subsection 2 of this section applies only to the 25-balance of the undistributed income. 26- [3.] 4. When a [trustee's] fiduciary's obligation to 27-pay a fixed annuity or a fixed fraction of the value of [the 28-trust's] assets ends, the [trustee] fiduciary shall prorate 29-the final payment [if and to the extent] as required [by 30-applicable law to accomplish a purpose of the trust or its 31-settlor relating] to preserve an income tax, gift tax, 32-estate tax, or other tax [requirements] benefit. 33- 469.423. 1. [For purposes of] As used in this 1-section, the [term] following terms mean: 2- (1) "Capital distribution", an entity distribution of 3-money that is a: 4- (a) Return of capital; or 5- (b) Distribution in total or partial liquidation of 6-the entity; 7- (2) "Entity" [means]: 8- (a) A corporation, partnership, limited liability 9-company, regulated investment company, real estate 10-investment trust, common trust fund, or any other 11-organization [in which a trustee has an interest, other than 12-a trust or estate to which section 469.425 applies, a 13-business or activity to which section 469.427 applies, or an 14-asset-backed security to which section 469.449 applies] or 15-arrangement in which a fiduciary owns or holds an interest, 16-whether or not the entity is a taxpayer for federal income 17-tax purposes; and 18- SB 1468 41- (b) The term "entity" does not include: 19- a. A trust or estate to which section 469.425 applies; 20- b. A business or other activity to which section 21-469.427 applies that is not conducted by an entity described 22-in paragraph (a) of this subdivision; 23- c. An asset-backed security; or 24- d. An instrument or arrangement to which section 25-469.446 applies; 26- (3) "Entity distribution", a payment or transfer by an 27-entity made to a person in the person's capacity as an owner 28-or holder of an interest in the entity. 29- 2. In this section, an attribute or action of an 30-entity includes an attribute or action of any other entity 31-in which the entity owns or holds an interest, including an 32-interest owned or held indirectly through another entity. 33- [2.] 3. Except as otherwise provided in subdivisions 34-(2) to (4) of subsection 4 of this section, a [trustee] 35-fiduciary shall allocate to income: 36- (1) Money received [from] in an entity[. 37- 3. A trustee shall allocate the following receipts 38-from an entity to principal: 39- (1) Property other than money; 40- (2) Money received in one distribution or a series of 41-related distributions in exchange for part or all of a 42-trust's interest in the entity; 43- (3) Money received in total or partial liquidation of 44-the entity; and 45- (4) Money received from an entity that is] 46-distribution; and 47- (2) Tangible personal property of nominal value 48-received from the entity. 49- 4. A fiduciary shall allocate to principal: 50- SB 1468 42- (1) Property received in an entity distribution that 51-is not: 52- (a) Money; or 53- (b) Tangible personal property of nominal value; 54- (2) Money received in an entity distribution in an 55-exchange for part or all of the fiduciary's interest in the 56-entity, to the extent the entity distribution reduces the 57-fiduciary's interest in the entity relative to the interests 58-of other persons that own or hold interests in the entity; 59- (3) Money received in an entity distribution that the 60-fiduciary determines or estimates is a capital distribution; 61-and 62- (4) Money received in an entity distribution from an 63-entity that is: 64- (a) A regulated investment company or [a] real estate 65-investment trust if the money [distributed] received is a 66-capital gain dividend for federal income tax purposes[. 67- 4. Money is received in partial liquidation: 68- (1) To the extent that the entity, at or near the time 69-of a distribution, indicates that such money is a 70-distribution in partial liquidation; or 71- (2) If]; or 72- (b) Treated for federal income tax purposes comparably 73-to the treatment described in paragraph (a) of this 74-subdivision. 75- 5. A fiduciary may determine or estimate that money 76-received in an entity distribution is a capital distribution: 77- (1) By relying, without inquiry or investigation, on a 78-characterization of the entity distribution provided by or 79-on behalf of the entity, unless the fiduciary: 80- SB 1468 43- (a) Determines, on the basis of information known to 81-the fiduciary, that the characterization is or may be 82-incorrect; or 83- (b) Owns or holds more than fifty percent of the 84-voting interest in the entity; 85- (2) By determining or estimating, on the basis of 86-information known to the fiduciary or provided to the 87-fiduciary by or on behalf of the entity, that the total 88-amount of money and property received by the fiduciary in 89-[a] the entity distribution or a series of related entity 90-distributions is or will be greater than twenty percent of 91-the [entity's gross assets, as shown by the entity's year- 92-end financial statements immediately preceding the initial 93-receipt. 94- 5. Money is not received in partial liquidation, nor 95-may it be taken into account pursuant to subdivision (2) of 96-subsection 4 of this section, to the extent that such money 97-does not exceed the amount of income tax that a trustee or 98-beneficiary shall pay on taxable income of the entity that 99-distributes the money. 100- 6. A trustee may rely upon a statement made by an 101-entity about the source or character of a distribution if 102-the statement is made at or near the time of distribution by 103-the entity's board of directors or other person or group of 104-persons authorized to exercise powers to pay money or 105-transfer property comparable to those of a corporation's 106-board of directors] fair market value of the fiduciary's 107-interest in the entity; or 108- (3) If neither subdivision (1) nor (2) of this 109-subsection applies, by considering the factors in subsection 110-6 of this section and the information known to the fiduciary 111-or provided to the fiduciary by or on behalf of the entity. 112- SB 1468 44- 6. In making a determination or estimate under 113-subdivision (3) of subsection 5 of this section, a fiduciary 114-may consider: 115- (1) A characterization of an entity distribution 116-provided by or on behalf of the entity; 117- (2) The amount of money or property received in: 118- (a) The entity distribution; or 119- (b) What the fiduciary determines is or will be a 120-series of related entity distributions; 121- (3) The amount described in subdivision (2) of this 122-subsection compared to the amount the fiduciary determines 123-or estimates is, during the current or preceding accounting 124-periods: 125- (a) The entity's operating income; 126- (b) The proceeds of the entity's sale or other 127-disposition of: 128- a. All or part of the business or other activity 129-conducted by the entity; 130- b. One or more business assets that are not sold to 131-customers in the ordinary course of the business or other 132-activity conducted by the entity; or 133- c. One or more assets other than business assets, 134-unless the entity's primary activity is to invest in assets 135-to realize gain on the disposition of all or some of the 136-assets; 137- (c) If the entity's primary activity is to invest in 138-assets to realize gain on the disposition of all or some of 139-the assets, the gain realized on the disposition; 140- (d) The entity's regular, periodic entity 141-distributions; 142- (e) The amount of money the entity has accumulated; 143- (f) The amount of money the entity has borrowed; 144- SB 1468 45- (g) The amount of money the entity has received from 145-the sources described in sections 469.433, 469.439, 469.441, 146-and 469.443; and 147- (h) The amount of money the entity has received from a 148-source not otherwise described in this subdivision; and 149- (4) Any other factor the fiduciary determines is 150-relevant. 151- 7. If, after applying subsections 3 to 6 of this 152-section, a fiduciary determines that a part of an entity 153-distribution is a capital distribution but is in doubt about 154-the amount of the entity distribution that is a capital 155-distribution, the fiduciary shall allocate to principal the 156-amount of the entity distribution that is in doubt. 157- 8. If a fiduciary receives additional information 158-about the application of this section to an entity 159-distribution before the fiduciary has paid part of the 160-entity distribution to a beneficiary, the fiduciary may 161-consider the additional information before making the 162-payment to the beneficiary and may change a decision to make 163-the payment to the beneficiary. 164- 9. If a fiduciary receives additional information 165-about the application of this section to an entity 166-distribution after the fiduciary has paid part of the entity 167-distribution to a beneficiary, the fiduciary is not required 168-to change or recover the payment to the beneficiary but may 169-consider that information in determining whether to exercise 170-the power to adjust under section 469.405. 171- 469.425. A [trustee] fiduciary shall allocate to 1-income an amount received as a distribution of income, 2-including a unitrust distribution under sections 469.471 to 3-469.487, from a trust or [an] estate in which the [trust] 4-fiduciary has an interest, other than [a] an interest the 5- SB 1468 46-fiduciary purchased [interest] in a trust that is an 6-investment entity, and shall allocate to principal an amount 7-received as a distribution of principal from [such a] the 8-trust or estate. If a [trustee] fiduciary purchases, or 9-receives from a settlor, an interest in a trust that is an 10-investment entity, [or a decedent or donor transfers an 11-interest in such a trust to a trustee,] section 469.423, 12-469.446, or 469.449 [shall apply] applies to a receipt from 13-the trust. 14- 469.427. 1. [If a trustee who conducts] This section 1-applies to a business or other activity conducted by a 2-fiduciary if the fiduciary determines that it is in the 3-[best interest] interests of [all] the beneficiaries to 4-account separately for the business or other activity 5-instead of: 6- (1) Accounting for [it] the business or other activity 7-as part of the [trust's] fiduciary's general accounting 8-records[,]; or 9- (2) Conducting the [trustee] business or other 10-activity through an entity described in paragraph (a) of 11-subdivision (2) of subsection 1 of section 469.423. 12- 2. A fiduciary may [maintain separate accounting 13-records] account separately under this section for [its] the 14-transactions of a business or other activity, whether or not 15-[its] assets of the business or other activity are 16-segregated from other [trust] assets held by the fiduciary. 17- [2.] 3. A [trustee who] fiduciary that accounts 18-separately under this section for a business or other 19-activity: 20- (1) May determine: 21- (a) The extent to which the net cash receipts of the 22-business or other activity shall be retained for: 23- SB 1468 47- a. Working capital[,]; 24- b. The acquisition or replacement of fixed assets[,]; 25-and 26- c. Other reasonably foreseeable needs of the business 27-or other activity[,]; and 28- (b) The extent to which the remaining net cash 29-receipts are accounted for as principal or income in the 30-[trust's] fiduciary's general accounting records[. If a 31-trustee sells assets of the business or other activity, 32-other than in the ordinary course of the business or 33-activity, the trustee] for the trust; 34- (2) May make a determination under subdivision (1) of 35-this subsection separately and differently from the 36-fiduciary's decisions concerning distributions of income or 37-principal; and 38- (3) Shall account for the net amount received from the 39-sale of an asset of the business or other activity, other 40-than a sale in the ordinary course of the business or other 41-activity, as principal in the [trust's] fiduciary's general 42-accounting records for the trust, to the extent the 43-[trustee] fiduciary determines that the net amount received 44-is no longer required in the conduct of the business or 45-other activity. 46- [3.] 4. Activities for which a [trustee may maintain 47-separate accounting records] fiduciary may account 48-separately under this section include: 49- (1) Retail, manufacturing, service, and other 50-traditional business activities; 51- (2) Farming; 52- (3) Raising and selling livestock and other animals; 53- (4) [Management of] Managing rental properties; 54- SB 1468 48- (5) [Extraction of] Extracting minerals, water, and 55-other natural resources; 56- (6) Growing and cutting timber [operations]; [and] 57- (7) [Activities] An activity to which section 469.446, 58-469.447, or 469.449 applies; and 59- (8) Any other business conducted by the fiduciary. 60- 469.429. A [trustee] fiduciary shall allocate to 1-principal: 2- (1) To the extent not allocated to income [pursuant 3-to] under sections [469.401] 469.399 to [469.467] 469.487, 4-[assets] an asset received from [a transferor]: 5- (a) An individual during the [transferor's] 6-individual's lifetime[, a decedent's]; 7- (b) An estate[,]; 8- (c) A trust [with a terminating] on termination of an 9-income interest[,]; or 10- (d) A payer under a contract naming the [trust or its 11-trustee] fiduciary as beneficiary; 12- (2) Except as otherwise provided in sections 469.423 13-to 469.449, money or other property received from the sale, 14-exchange, liquidation, or change in form of a principal 15-asset[, including realized profit, subject to sections 16-469.423 to 469.467]; 17- (3) [Amounts] An amount recovered from a third 18-[parties] party to reimburse the [trust] fiduciary because 19-of [disbursements] a disbursement described in [subdivision 20-(7) of] subsection 1 of section 469.453 or for [other 21-reasons] another reason to the extent not based on [the] 22-loss of income; 23- (4) Proceeds of property taken by eminent domain, [but 24-a separate award made] except that proceeds awarded for 25-[the] loss of income [with respect to] in an accounting 26- SB 1468 49-period [during which] are income if a current income 27-beneficiary had a mandatory income interest [is income] 28-during the period; 29- (5) Net income received in an accounting period during 30-which there is no beneficiary to [whom] which a [trustee] 31-fiduciary may or shall distribute income; and 32- (6) Other receipts as provided in sections 469.435 to 33-469.449. 34- 469.431. To the extent [that a trustee accounts] a 1-fiduciary does not account for [receipts from] the 2-management of rental property [pursuant to this section] as 3-a business under section 469.427, the [trustee] fiduciary 4-shall allocate to income an amount received as rent of real 5-or personal property, including an amount received for 6-cancellation or renewal of a lease. An amount received as a 7-refundable deposit, including a security deposit or a 8-deposit that is to be applied as rent for future periods[,]: 9- (1) Shall be added to principal and held subject to 10-the terms of the lease, except as otherwise provided by law 11-other than sections 469.399 to 469.487; and 12- (2) Is not allocated to income or available for 13-distribution to a beneficiary until the [trustee's] 14-fiduciary's contractual obligations have been satisfied with 15-respect to that amount. 16- 469.432. 1. This section does not apply to an 1-obligation to which section 469.437, 469.439, 469.441, 2-469.443, 469.446, 469.447, or 469.449 applies. 3- 2. A fiduciary shall allocate to income, without 4-provision for amortization of premium, an amount received as 5-interest[, whether determined at a fixed, variable or 6-floating rate,] on an obligation to pay money to the 7-[trustee] fiduciary, including an amount received as 8- SB 1468 50-consideration for prepaying principal[, shall be allocated 9-to income without any provision for amortization of premium]. 10- [2.] 3. A [trustee] fiduciary shall allocate to 11-principal an amount received from the sale, redemption, or 12-other disposition of an obligation to pay money to the 13-[trustee more than one year after it is purchased or 14-acquired by the trustee, including an obligation whose 15-purchase price or value when it is acquired is less than its 16-value at maturity. If the obligation matures within one 17-year after it is purchased or acquired by the trustee, an 18-amount received in excess of its purchase price or its value 19-when acquired by the trust shall be allocated to income. 20- 3. This section does not apply to an obligation to 21-which section 469.437, 469.439, 469.441, 469.443, 469.447 or 22-469.449 applies] fiduciary. A fiduciary shall allocate to 23-income the increment in value of a bond or other obligation 24-for the payment of money bearing no stated interest but 25-payable or redeemable, at maturity or another future time, 26-in an amount that exceeds the amount in consideration of 27-which it was issued. 28- 469.433. 1. This section does not apply to a contract 1-to which section 469.437 applies. 2- 2. Except as otherwise provided in subsection [2] 3 of 3-this section, a [trustee] fiduciary shall allocate to 4-principal the proceeds of a life insurance policy or other 5-contract [in which the trust or its trustee is named] 6-received by the fiduciary as beneficiary, including a 7-contract that insures [the trust or its trustee] against 8-[loss for] damage to, destruction of, or loss of title to [a 9-trust] an asset. The [trustee] fiduciary shall allocate 10-dividends on an insurance policy to income [if] to the 11-extent premiums on the policy are paid from income[,] and to 12- SB 1468 51-principal [if] to the extent premiums on the policy are paid 13-from principal. 14- [2.] 3. A [trustee] fiduciary shall allocate to income 15-proceeds of a contract that insures the [trustee] fiduciary 16-against loss of: 17- (1) Occupancy or other use by [an] a current income 18-beneficiary[, loss of]; 19- (2) Income[,]; or[,] 20- (3) Subject to section 469.427, [loss of] profits from 21-a business. 22- [3. This section does not apply to a contract to which 23-section 469.437 applies.] 24- 469.435. 1. If a [trustee] fiduciary determines that 1-an allocation between income and principal [and income] 2-required by section 469.437, 469.439, 469.441, 469.443 or 3-469.449 is insubstantial, the [trustee] fiduciary may 4-allocate the entire amount to principal, unless [one of the 5-circumstances described in] subsection [3] 5 of section 6-469.405 applies to the allocation. [This power] 7- 2. A fiduciary may [be exercised by a cotrustee in the 8-circumstances described in subsection 4 of section 469.405 9-and may be released for the reasons and in the manner 10-described in subsection 5 of section 469.405.] presume an 11-allocation is [presumed to be] insubstantial under 12-subsection 1 of this section if: 13- (1) The amount of the allocation would increase or 14-decrease net income in an accounting period, as determined 15-before the allocation, by less than ten percent; [or] and 16- (2) [The value of] The asset producing the receipt 17-[for which the allocation would] to be [made is] allocated 18-has a fair market value less than ten percent of the total 19- SB 1468 52-fair market value of the [trust's] assets owned or held by 20-the fiduciary at the beginning of the accounting period. 21- 3. The power to make a determination under subsection 22-1 of this section may be: 23- (1) Exercised by a cofiduciary in the manner described 24-in subsection 6 of section 469.405; or 25- (2) Released or delegated for a reason described in 26-subsection 7 of section 469.405 and in the manner described 27-in subsection 8 of section 469.405. 28- 469.437. 1. As used in this section, the following 1-terms mean: 2- (1) "Internal income of a separate fund", the amount 3-determined under subsection 2 of this section; 4- (2) "Marital trust", a trust: 5- (a) Of which the settlor's surviving spouse is the 6-only current income beneficiary and is entitled to a 7-distribution of all the current net income of the trust; and 8- (b) That qualifies for a marital deduction with 9-respect to the settlor's estate under 26 U.S.C. Section 10-2056, as amended, because: 11- a. An election to qualify for a marital deduction 12-under 26 U.S.C. Section 2056(b)(7), as amended, has been 13-made; or 14- b. The trust qualifies for a marital deduction under 15-26 U.S.C. Section 2056(b)(5), as amended; 16- (3) "Payment", an amount [that is: 17- (a) Received or withdrawn from a plan; or 18- (b) One of a series of distributions that have been or 19-will be received] a fiduciary may receive over a fixed 20-number of years or during the life of one or more 21-individuals [under any contractual or other arrangement, or 22-is a single payment from a plan that the trustee could have 23- SB 1468 53-received over a fixed number of years or during the life of 24-one or more individuals] because of services rendered or 25-property transferred to the payer in exchange for future 26-amounts the fiduciary may receive. The term "payment" 27-includes an amount received in money or property from the 28-payer's general assets or from a separate fund created by 29-the payer; 30- [(2) "Plan", a contractual, custodial, trust or other 31-arrangement that provides for distributions to the trust, 32-including, but not limited to, qualified retirement plans, 33-Individual Retirement Accounts, Roth Individual Retirement 34-Accounts, public and private annuities, and deferred 35-compensation, including payments received directly from an 36-entity as defined in section 469.423 regardless of whether 37-or not such distributions are made from a specific fund or 38-account. 39- 2. If any portion of a payment is characterized as a 40-distribution to the trustee of interest, dividends or a 41-dividend equivalent, the trustee shall allocate the portion 42-so characterized to income. The trustee shall allocate the 43-balance of that payment to principal. 44- 3. If no part of a payment is allocated to income 45-pursuant to subsection 2 of this section, then for each 46-accounting period of the trust that any payment is received 47-by the trust with respect to the trust's interest in a plan, 48-the trustee shall allocate to income that portion of the 49-aggregate value of all payments received by the trustee in 50-that accounting period equal to the amount of plan income 51-attributable to the trust's interest in the plan for that 52-calendar year. The trustee shall allocate the balance of 53-that payment to principal. 54- SB 1468 54- 4. For purposes of this section, if a payment is 55-received from a plan that maintains a separate account or 56-fund for its participants or account holders, including, but 57-not limited to, defined contribution retirement plans, 58-Individual Retirement Accounts, Roth Individual Retirement 59-Accounts, and some types of deferred compensation plans, the 60-phrase "plan income" shall mean either the amount of the 61-plan account or fund held for the benefit of the trust that, 62-if the plan account or fund were a trust, would be allocated 63-to income pursuant to sections 469.401 to 469.467 for that 64-accounting period, or four percent of the value of the plan 65-account or fund on the first day of that accounting period. 66-The method of determining plan income pursuant to this 67-subsection shall be chosen by the trustee in the trustee's 68-discretion. The trustees may change the method of 69-determining plan income pursuant to this subsection for any 70-future accounting period. 71- 5. For purposes of this section if the payment is 72-received from a plan that does not maintain a separate 73-account or fund for its participants or account holders, 74-including by way of example and not limitation defined 75-benefit retirement plans and some types of deferred 76-compensation plans, the term "plan income" shall mean four 77-percent of the total present value of the trust's interest 78-in the plan as of the first day of the accounting period, 79-based on reasonable actuarial assumptions as determined by 80-the trustee. 81- 6. Notwithstanding subsections 1 to 5 of this section, 82-with respect to a trust where an election to qualify for a 83-marital deduction under Section 2056(b)(7) or Section 84-2523(f) of the Internal Revenue Code of 1986, as amended, 85-has been made, or a trust that qualified for the marital 86- SB 1468 55-deduction under either Section 2056(b)(5) or Section 2523(e) 87-of the Internal Revenue Code of 1986, as amended, a trustee 88-shall determine the plan income for the accounting period as 89-if the plan were a trust subject to sections 469.401 to 90-469.467. Upon request of the surviving spouse, the trustee 91-shall demand that the person administering the plan 92-distribute the plan income to the trust. The trustee shall 93-allocate a payment from the plan to income to the extent of 94-the plan income and distribute that amount to the surviving 95-spouse. The trustee shall allocate the balance of the 96-payment to principal. Upon request of the surviving spouse, 97-the trustee shall allocate principal to income to the extent 98-the plan income exceeds payments made from the plan to the 99-trust during the accounting period. 100- 7. If, to obtain an estate or gift tax marital 101-deduction for a trust, a trustee shall allocate more of a 102-payment to income than provided for by this section, the 103-trustee shall allocate to income the additional amount 104-necessary to obtain the marital deduction.] 105- (4) "Separate fund", includes a private or commercial 106-annuity, an individual retirement account, and a pension, 107-profit-sharing, stock bonus, or stock ownership plan. 108- 2. For each accounting period, the following rules 109-apply to a separate fund: 110- (1) The fiduciary shall determine the internal income 111-of the separate fund as if the separate fund was a trust 112-subject to sections 469.399 to 469.487; 113- (2) If the fiduciary cannot determine the internal 114-income of the separate fund under subdivision (1) of this 115-subsection, the internal income of the separate fund is 116-deemed to equal three percent of the value of the separate 117- SB 1468 56-fund, according to the most recent statement of value 118-preceding the beginning of the accounting period; and 119- (3) If the fiduciary cannot determine the value of the 120-separate fund under subdivision (2) of this subsection, the 121-value of the separate fund is deemed to equal the present 122-value of the expected future payments, as determined under 123-26 U.S.C. Section 7520, as amended, for the month preceding 124-the beginning of the accounting period for which the 125-computation is made. 126- 3. A fiduciary shall allocate a payment received from 127-a separate fund during an accounting period to income, to 128-the extent of the internal income of the separate fund 129-during the accounting period, and the balance to principal. 130- 4. The fiduciary of a marital trust shall: 131- (1) Withdraw from a separate fund the amount the 132-current income beneficiary of the trust requests the 133-fiduciary to withdraw, not greater than the amount by which 134-the internal income of the separate fund during the 135-accounting period exceeds the amount the fiduciary otherwise 136-receives from the separate fund during the accounting period; 137- (2) Transfer from principal to income the amount the 138-current income beneficiary requests the fiduciary to 139-transfer, not greater than the amount by which the internal 140-income of the separate fund during the accounting period 141-exceeds the amount the fiduciary receives from the separate 142-fund during the accounting period after the application of 143-subdivision (1) of this subsection; and 144- (3) Distribute to the current income beneficiary as 145-income: 146- (a) The amount of the internal income of the separate 147-fund received or withdrawn during the accounting period; and 148- SB 1468 57- (b) The amount transferred from principal to income 149-under subdivision (2) of this subsection. 150- 5. For a trust, other than a marital trust, of which 151-one or more current income beneficiaries are entitled to a 152-distribution of all the current net income, the fiduciary 153-shall transfer from principal to income the amount by which 154-the internal income of a separate fund during the accounting 155-period exceeds the amount the fiduciary receives from the 156-separate fund during the accounting period. 157- 469.439. 1. As used in this section, the [phrase] 1-term "liquidating asset" means an asset whose value will 2-diminish or terminate because the asset is expected to 3-produce receipts for a [period of] limited [duration] time. 4-The [phrase] term "liquidating asset" includes a leasehold, 5-patent, copyright, royalty right, and right to receive 6-payments during a period of more than one year under an 7-arrangement that does not provide for the payment of 8-interest on the unpaid balance. [The phrase] 9- 2. This section does not [include a payment] apply to 10-a receipt subject to section 469.423, 469.437, [resources 11-subject to section] 469.441, [timber subject to section] 12-469.443, [an activity subject to section] 469.446, 469.447, 13-[an asset subject to section] 469.449, or [any asset for 14-which the trustee establishes a reserve for depreciation 15-pursuant to section] 469.455. 16- [2.] 3. A [trustee] fiduciary shall allocate: 17- (1) To income [ten percent of the receipts from]: 18- (a) A receipt produced by a liquidating asset [and the 19-balance], to the extent the receipt does not exceed three 20-percent of the value of the asset; or 21- (b) If the fiduciary cannot determine the value of the 22-asset, ten percent of the receipt; and 23- SB 1468 58- (2) To principal, the balance of the receipt. 24- 469.441. 1. To the extent [that a trustee accounts 1-for receipts] a fiduciary does not account for a receipt 2-from an interest in minerals, water, or other natural 3-resources [pursuant to this section] as a business under 4-section 469.427, the [trustee] fiduciary shall allocate 5-[them as follows] the receipt: 6- (1) [If] To income, to the extent received: 7- (a) As [nominal] delay rental or [nominal] annual rent 8-on a lease[, a receipt shall be allocated to income]; 9- (b) As a factor for interest or the equivalent of 10-interest under an agreement creating a production payment; or 11- (c) On account of an interest in renewable water; 12- (2) To principal, if received from a production 13-payment, [a receipt shall be allocated to income if and to 14-the extent that the agreement creating the production 15-payment provides a factor for interest or its equivalent. 16-The balance shall be allocated to principal;] to the extent 17-paragraph (b) of subdivision (1) of this subsection does not 18-apply; or 19- (3) [If an amount received] Between income and 20-principal equitably, to the extent received: 21- (a) On account of an interest in nonrenewable water; 22- (b) As a royalty, shut-in-well payment, take-or-pay 23-payment, or bonus [or delay rental is more than nominal, 24-ninety percent shall be allocated to principal and the 25-balance to income]; or 26- [(4) If an amount is received] (c) From a working 27-interest or any other interest not provided for in 28-subdivision (1)[,] or (2) [or (3)] of this subsection[, 29-ninety percent of the net amount received shall be allocated 30- SB 1468 59-to principal and the balance to income] or paragraph (a) or 31-(b) of this subdivision. 32- 2. [An amount received on account of] This section 33-applies to an interest [in water that is renewable shall be 34-allocated to income. If the water is not renewable, ninety 35-percent of the amount shall be allocated to principal and 36-the balance to income. 37- 3. Sections 469.401 to 469.467 apply] owned or held by 38-a fiduciary whether or not a [decedent or donor] settlor was 39-extracting minerals, water, or other natural resources 40-before the fiduciary owned or held the interest [became 41-subject to the trust]. 42- 3. An allocation of a receipt under subdivision (3) of 43-subsection 1 of this section is presumed to be equitable if 44-the amount allocated to principal is equal to the amount 45-allowed by Title 26 of the United States Code, as amended, 46-as a deduction for depletion of the interest. 47- 4. If a [trust] fiduciary owns or holds an interest in 48-minerals, water, or other natural resources [on] before 49-August 28, [2001] 2026, the [trustee] fiduciary may allocate 50-receipts from the interest as provided in [sections 469.401 51-to 469.467] this section or in the manner used by the 52-[trustee] fiduciary before August 28, [2001] 2026. If the 53-[trust] fiduciary acquires an interest in minerals, water, 54-or other natural resources on or after August 28, [2001] 55-2026, the [trustee] fiduciary shall allocate receipts from 56-the interest as provided in [sections 469.401 to 469.467] 57-this section. 58- 469.443. 1. To the extent [that a trustee accounts] a 1-fiduciary does not account for receipts from the sale of 2-timber and related products [pursuant to this] as a business 3- SB 1468 60-under section 469.427, the [trustee] fiduciary shall 4-allocate the net receipts: 5- (1) To income, to the extent [that] the amount of 6-timber [removed] cut from the land does not exceed the rate 7-of growth of the timber [during the accounting periods in 8-which a beneficiary has a mandatory income interest]; 9- (2) To principal, to the extent [that] the amount of 10-timber [removed] cut from the land exceeds the rate of 11-growth of the timber or the net receipts are from the sale 12-of standing timber; 13- (3) [To or] Between income and principal if the net 14-receipts are from the lease of [timberland] land used for 15-growing and cutting timber or from a contract to cut timber 16-from land [owned by a trust], by determining the amount of 17-timber [removed] cut from the land under the lease or 18-contract and applying the rules in subdivisions (1) and (2) 19-of this subsection; or 20- (4) To principal, to the extent [that] advance 21-payments, bonuses, and other payments are not allocated 22-[pursuant to either] under subdivision (1), (2), or (3) of 23-this subsection. 24- 2. In determining net receipts to be allocated 25-[pursuant to] under subsection 1 of this section, a 26-[trustee] fiduciary shall deduct and transfer to principal a 27-reasonable amount for depletion. 28- 3. [Sections 469.401 to 469.467 apply] This section 29-applies to land owned or held by a fiduciary whether or not 30-a [decedent or transferor] settlor was [harvesting] cutting 31-timber from the land before the fiduciary owned or held the 32-property [before it became subject to the trust]. 33- 4. If a [trust] fiduciary owns or holds an interest in 34-[timberland on] land used for growing and cutting timber 35- SB 1468 61-before August 28, [2001] 2026, the [trustee] fiduciary may 36-allocate net receipts from the sale of timber and related 37-products as provided in [sections 469.401 to 469.467] this 38-section or in the manner used by the [trustee] fiduciary 39-before August 28, [2001] 2026. If the [trust] fiduciary 40-acquires an interest in [timberland] land used for growing 41-and cutting timber on or after August 28, [2001] 2026, the 42-[trustee] fiduciary shall allocate net receipts from the 43-sale of timber and related products as provided in [sections 44-469.401 to 469.467] this section. 45- 469.445. 1. If a trust received property for which a 1-gift or estate tax marital deduction [is] was allowed [for 2-all or part of a trust whose] and the settlor's spouse holds 3-a mandatory income interest in the trust, the spouse may 4-require the trustee, to the extent the trust assets [consist 5-substantially of property that does] otherwise do not 6-provide the spouse with sufficient income from or use of the 7-trust assets[, and if the amounts that the trustee transfers 8-from principal to income pursuant to section 469.405 and 9-distributes to the spouse from principal pursuant to the 10-terms of the trust are insufficient to provide the spouse 11-with the beneficial enjoyment required to obtain the 12-marital] to qualify for the deduction, [the spouse may 13-require the trustee] to: 14- (1) Make property productive of income[,]; 15- (2) Convert property to property productive of income 16-within a reasonable time[,]; or 17- (3) Exercise the power [conferred by subsection 1 of] 18-to adjust under section 469.405. 19- 2. The trustee may decide which action or combination 20-of actions in subsection 1 of this section to take. 21- SB 1468 62- [2. In cases not governed by subsection 1 of this 22-section, proceeds from the sale or other disposition of an 23-asset are principal without regard to the amount of income 24-the asset produces during any accounting period.] 25- 469.446. A fiduciary shall allocate receipts from or 1-related to a financial instrument or arrangement not 2-otherwise addressed by sections 469.399 to 469.487. The 3-allocation shall be consistent with sections 469.447 and 4-469.449. 5- 469.447. 1. As used in this section, the term 1-"derivative" means a contract [or financial], instrument, 2-other arrangement, or [a] combination of contracts [and 3-financial], instruments, or other arrangements, the value, 4-rights, and obligations of which [gives a trust the right or 5-obligation to participate in some or all changes in the 6-price of a] are, in whole or in part, dependent on or 7-derived from an underlying tangible or intangible asset 8-[or], group of tangible or intangible assets, [or changes in 9-a rate, an] index [of prices], or occurrence of an event. 10-The term "derivative" includes stocks, fixed income 11-securities, and financial instruments and arrangements based 12-on indices, commodities, interest rates, [or other market 13-indicator for an asset or a group of assets] weather-related 14-events, and credit default events. 15- 2. To the extent [that a trustee] a fiduciary does not 16-account [pursuant to section 469.427 for transactions] for a 17-transaction in derivatives[, the trustee] as a business 18-under section 469.427, the fiduciary shall allocate [to 19-principal] ten percent of receipts from the transaction and 20-ten percent of disbursements made in connection with [those 21-transactions] the transaction to income and the balance to 22-principal. 23- SB 1468 63- 3. The provisions of subsection 4 of this section 24-apply if: 25- (1) A [trustee] fiduciary: 26- (a) Grants an option to buy property from [the] a 27-trust, whether or not the trust owns the property when the 28-option is granted[,]; 29- (b) Grants an option that permits another person to 30-sell property to the trust[,]; or 31- (c) Acquires an option to buy property for the trust 32-or an option to sell an asset owned by the trust[,]; and 33- (2) The [trustee] fiduciary or other owner of the 34-asset is required to deliver the asset if the option is 35-exercised[,]. 36- 4. If this subsection applies, the fiduciary shall 37-allocate ten percent to income and the balance to principal 38-of the following amounts: 39- (1) An amount received for granting the option [shall 40-be allocated to principal.]; 41- (2) An amount paid to acquire the option [shall be 42-paid from principal. A]; and 43- (3) Gain or loss realized [upon] on the exercise [of 44-an option, including an option granted to a settlor], 45-exchange, settlement, offset, closing, or expiration of the 46-[trust for services rendered, shall be allocated to 47-principal] option. 48- 469.449. 1. [As used in this section, the phrase 1-"asset-backed security" means an asset whose value is based 2-upon the right it gives the owner to receive distributions 3-from the proceeds of financial assets that provide 4-collateral for the security. The phrase includes an asset 5-that gives the owner the right to receive from the 6-collateral financial assets only the interest or other 7- SB 1468 64-current return or only the proceeds other than interest or 8-current return. The phrase does not include an asset to 9-which section 469.423 or 469.437 applies. 10- 2. If a trust receives a payment from interest or 11-other current return and from other proceeds of the 12-collateral financial assets, the trustee] Except as 13-otherwise provided in subsection 2 of this section, a 14-fiduciary shall allocate to income [the portion of the 15-payment which] a receipt from or related to an asset-backed 16-security, to the extent the payer identifies the payment as 17-being from interest or other current return, and [shall 18-allocate] to principal the balance of the [payment to 19-principal] receipt. 20- [3.] 2. If a [trust] fiduciary receives one or more 21-payments in exchange for part or all of the [trust's entire] 22-fiduciary's interest in an asset-backed security [in one 23-accounting period, the trustee shall allocate the payments 24-to principal. If a payment is one of a series of payments 25-that will result in the], including a liquidation or 26-redemption of the [trust's] fiduciary's interest in the 27-security [over more than one accounting period], the 28-[trustee] fiduciary shall allocate to income ten percent of 29-receipts from the [payment to income] transaction and [the 30-balance] ten percent of disbursements made in connection 31-with the transaction, and to principal the balance of the 32-receipts and disbursements. 33- 469.451. [A trustee shall make the following 1-disbursements from income to the extent that they are not 2-disbursements to which paragraph (b) or (c) of] Subject to 3-section 469.456, and except as otherwise provided in 4-subdivision (2) or (3) of subsection 3 of section 469.413 5-[applies], a fiduciary shall disburse from income: 6- SB 1468 65- (1) One-half of: 7- (a) The regular compensation of the [trustee] 8-fiduciary and [of] any person providing investment advisory 9-[or], custodial, or other services to the [trustee] 10-fiduciary, to the extent income is sufficient; and 11- [(2) One-half of all expenses] (b) An expense for 12-[accountings] an accounting, judicial [proceedings] or 13-nonjudicial proceeding, or other [matters] matter that 14-[involve] involves both [the] income and [remainder] 15-successive interests, to the extent income is sufficient; 16- [(3) All of the other] (2) The balance of the 17-disbursements described in subdivision (1) of this section, 18-to the extent a fiduciary that is an independent person 19-determines that making those disbursements from income would 20-be in the interests of the beneficiaries; 21- (3) Another ordinary [expenses] expense incurred in 22-connection with [the] administration, management, or 23-preservation of [trust] property and [the] distribution of 24-income, including interest, an ordinary [repairs] repair, 25-regularly recurring [taxes] tax assessed against principal, 26-and [expenses] an expense of [a] an accounting, judicial or 27-nonjudicial proceeding, or other matter that [concerns] 28-involves primarily [the] an income interest, to the extent 29-income is sufficient; and 30- (4) [Recurring premiums] A premium on insurance 31-covering [the] loss of a principal asset or [the loss of] 32-income from or use of the asset. 33- 469.453. 1. [A trustee shall make the following 1-disbursements] Subject to section 469.457, and except as 2-otherwise provided in subdivision (2) of subsection 3 of 3-section 469.413, a fiduciary shall disburse from principal: 4- SB 1468 66- (1) The [remaining one-half] balance of the 5-disbursements described in subdivisions (1) and [(2)] (3) of 6-section 469.451, after application of subdivision (2) of 7-section 469.451; 8- (2) [All of] The [trustee's] fiduciary's compensation 9-calculated on principal as a fee for acceptance, 10-distribution, or termination[, and disbursements made to 11-prepare property for sale]; 12- (3) [Payments] A payment of an expense to prepare for 13-or execute a sale or other disposition of property; 14- (4) A payment on the principal of a trust debt; 15- [(4) Expenses of a] (5) A payment of an expense of an 16-accounting, judicial or nonjudicial proceeding, or other 17-matter that [concerns] involves primarily [an interest in] 18-principal, including a proceeding to construe the terms of 19-the trust or protect property; 20- [(5) Premiums paid on a policy of] (6) A payment of a 21-premium for insurance, including title insurance, not 22-described in subdivision (4) of section 469.451 of which the 23-[trust] fiduciary is the owner and beneficiary; 24- [(6)] (7) A payment of an estate[,] or inheritance 25-[and other transfer taxes] tax or other tax imposed because 26-of the death of a decedent, including penalties, apportioned 27-to the trust; and 28- [(7) Extraordinary expenses incurred in connection 29-with the management and preservation of trust property; 30- (8) Expenses for a capital improvement to a principal 31-asset, whether in the form of changes to an existing asset 32-or the construction of a new asset, including special 33-assessments; and 34- (9) Disbursements] (8) A payment: 35- (a) Related to environmental matters, including: 36- SB 1468 67- a. Reclamation[,]; 37- b. Assessing environmental conditions[,]; 38- c. Remedying and removing environmental 39-contamination[,]; 40- d. Monitoring remedial activities and the release of 41-substances[,]; 42- e. Preventing future releases of substances[,]; 43- f. Collecting amounts from persons liable or 44-potentially liable for the costs of [those] activities[,] 45-described in subparagraphs a. to e. of this paragraph; 46- g. Penalties imposed under environmental laws or 47-regulations [and]; 48- h. Other [payments made] actions to comply with 49-[those] environmental laws or regulations[,]; 50- i. Statutory or common law claims by third parties[,]; 51-and 52- j. Defending claims based on environmental matters; and 53- (b) For a premium for insurance for matters described 54-in paragraph (a) of this subdivision. 55- 2. If a principal asset is encumbered with an 56-obligation that requires income from [that] the asset to be 57-paid directly to [the] a creditor, the [trustee] fiduciary 58-shall transfer from principal to income an amount equal to 59-the income paid to the creditor in reduction of the 60-principal balance of the obligation. 61- 469.455. 1. As used in this section, the term 1-"depreciation" means a reduction in value due to wear, tear, 2-decay, corrosion, or gradual obsolescence of a [fixed] 3-tangible asset having a useful life of more than one year. 4- 2. A [trustee] fiduciary may transfer to principal a 5-reasonable amount of the net cash receipts from a principal 6- SB 1468 68-asset that is subject to depreciation, but [may] shall not 7-transfer any amount for depreciation: 8- (1) Of [that portion] the part of real property used 9-or available for use by a beneficiary as a residence [or]; 10- (2) Of tangible personal property held or made 11-available for the personal use or enjoyment of a beneficiary; 12- [(2) During the administration of a decedent's 13-estate;] or 14- (3) [Pursuant to] Under this section [if the trustee 15-is accounting pursuant], to the extent the fiduciary 16-accounts: 17- (a) Under section 469.439 for the asset; or 18- (b) Under section 469.427 for the business or other 19-activity in which the asset is used. 20- 3. An amount transferred to principal under this 21-section need not be separately held [as a separate fund]. 22- 469.456. 1. If a fiduciary makes or expects to make 1-an income disbursement described in subsection 2 of this 2-section, the fiduciary may transfer an appropriate amount 3-from principal to income in one or more accounting periods 4-to reimburse income. 5- 2. To the extent the fiduciary has not been and does 6-not expect to be reimbursed by a third party, income 7-disbursements to which subsection 1 of this section applies 8-include: 9- (1) An amount chargeable to principal but paid from 10-income because principal is illiquid; 11- (2) A disbursement made to prepare property for sale, 12-including improvements and commissions; and 13- (3) A disbursement described in subsection 1 of 14-section 469.453. 15- SB 1468 69- 3. If an asset whose ownership gives rise to an income 16-disbursement becomes subject to a successive interest after 17-an income interest ends, the fiduciary may continue to make 18-transfers under subsection 1 of this section. 19- 469.457. 1. If a [trustee] fiduciary makes or expects 1-to make a principal disbursement described in subsection 2 2-of this section, the [trustee] fiduciary may transfer an 3-appropriate amount from income to principal in one or more 4-accounting periods to reimburse principal or [to] provide a 5-reserve for future principal disbursements. 6- 2. To the extent a fiduciary has not been and does not 7-expect to be reimbursed by a third party, principal 8-disbursements to which subsection 1 of this section applies 9-include [the following, but only to the extent that the 10-trustee has not been and does not expect to be reimbursed by 11-a third party]: 12- (1) An amount chargeable to income but paid from 13-principal because [it] income is [unusually large, including 14-extraordinary repairs] not sufficient; 15- (2) [Disbursements] The cost of an improvement to 16-principal, whether a change to an existing asset or the 17-construction of a new asset, including a special assessment; 18- (3) A disbursement made to prepare property for 19-rental, including tenant allowances, leasehold improvements, 20-and [broker's] commissions; 21- [(3)] (4) A periodic [payments] payment on an 22-obligation secured by a principal asset, to the extent 23-[that] the amount transferred from income to principal for 24-depreciation is less than the periodic [payments] payment; 25-and 26- [(4) Disbursements] (5) A disbursement described in 27-[subdivision (7) of] subsection 1 of section 469.453. 28- SB 1468 70- 3. If [the] an asset whose ownership gives rise to 29-[the disbursements] a principal disbursement becomes subject 30-to a successive [income] interest after an income interest 31-ends, [a trustee] the fiduciary may continue to [transfer 32-amounts from income to principal as provided in] make 33-transfers under subsection 1 of this section. 34- 469.459. 1. A tax required to be paid by a [trustee] 1-fiduciary that is based on receipts allocated to income 2-shall be paid from income. 3- 2. A tax required to be paid by a [trustee] fiduciary 4-that is based on receipts allocated to principal shall be 5-paid from principal, even if the tax is called an income tax 6-by the taxing authority. 7- 3. Subject to subsection 4 of this section and 8-sections 469.456, 469.457, and 469.462, a tax required to be 9-paid by a [trustee] fiduciary on [the trust's] a share of an 10-entity's taxable income in an accounting period shall be 11-paid from: 12- (1) [From] Income and principal proportionately to the 13-[extent that] allocation between income and principal of 14-receipts from the entity [are allocated to income] in the 15-accounting period; and 16- (2) [From] Principal to the extent [that] the tax 17-exceeds the receipts from the entity [are allocated only to 18-principal] in the accounting period. 19- 4. After applying subsections 1 to 3 of this section, 20-[the trustee] a fiduciary shall adjust income or principal 21-receipts, to the extent [that] the [trust's] taxes the 22-fiduciary pays are reduced because [the trust receives] of a 23-deduction for a payment made to a beneficiary. 24- 469.462. 1. A fiduciary may make an adjustment 1-between income and principal to offset the shifting of 2- SB 1468 71-economic interests or tax benefits between current income 3-beneficiaries and successor beneficiaries that arises from: 4- (1) An election or decision the fiduciary makes 5-regarding a tax matter, other than a decision to claim an 6-income tax deduction to which subsection 2 of this section 7-applies; 8- (2) An income tax or other tax imposed on the 9-fiduciary or a beneficiary as a result of a transaction 10-involving the fiduciary or a distribution by the fiduciary; 11-or 12- (3) Ownership by the fiduciary of an interest in an 13-entity, a part of whose taxable income, whether or not 14-distributed, is includable in the taxable income of the 15-fiduciary or a beneficiary. 16- 2. If the amount of an estate tax marital or 17-charitable deduction is reduced because a fiduciary deducts 18-an amount paid from principal for income tax purposes 19-instead of deducting it for estate tax purposes and, as a 20-result, estate taxes paid from principal are increased and 21-income taxes paid by the fiduciary or a beneficiary are 22-decreased, the fiduciary shall charge each beneficiary that 23-benefits from the decrease in income tax to reimburse the 24-principal from which the increase in estate tax is paid. 25-The total reimbursement shall equal the increase in the 26-estate tax, to the extent the principal used to pay the 27-increase would have qualified for a marital or charitable 28-deduction but for the payment. The share of the 29-reimbursement for each fiduciary or beneficiary whose income 30-taxes are reduced shall be the same as its share of the 31-total decrease in income tax. 32- 3. A fiduciary that charges a beneficiary under 33-subsection 2 of this section may offset the charge by 34- SB 1468 72-obtaining payment from the beneficiary, withholding an 35-amount from future distributions to the beneficiary, or 36-adopting another method or combination of methods. 37- 469.463. In applying and construing sections [469.401] 1-469.399 to [469.467] 469.487, consideration shall be given 2-to the need to promote uniformity of the law with respect to 3-its subject matter among states that enact it. 4- 469.464. The provisions of sections 469.399 to 469.487 1-modify, limit, or supersede the Electronic Signatures in 2-Global and National Commerce Act, 15 U.S.C. Section 7001, et 3-seq., but do not modify, limit, or supersede 15 U.S.C. 4-Section 7001(c) or authorize electronic delivery of any of 5-the notices described in 15 U.S.C. Section 7003(b). 6- 469.465. If any provision of sections [469.401] 1-469.399 to [469.467] 469.487 or [the] its application [of 2-these sections] to any person or circumstance is held 3-invalid, the invalidity does not affect other provisions or 4-applications of sections [469.401] 469.399 to [469.467] 5-469.487 which can be given effect without the invalid 6-provision or application and to this end, the provisions of 7-sections 469.399 to 469.487 are severable. 8- 469.467. The provisions of sections [469.401] 469.399 1-to [469.467] 469.487 apply to [every] a trust or 2-[decedent's] estate existing or created on or after August 3-28, [2001] 2026, except as otherwise expressly provided in 4-the [will or] terms of the trust or [in] sections [469.401] 5-469.399 to [469.467] 469.487. 6- 469.471. As used in sections 469.471 to 469.487, the 1-following terms mean: 2- (1) "Applicable value", the amount of the net fair 3-market value of a trust taken into account under section 4-469.483; 5- SB 1468 73- (2) "Express unitrust", a trust for which, under the 6-terms of the trust without regard to sections 469.471 to 7-469.487, income or net income shall or may be calculated as 8-a unitrust amount; 9- (3) "Income trust", a trust that is not a unitrust; 10- (4) "Net fair market value of a trust", the fair 11-market value of the assets of the trust, less the 12-noncontingent liabilities of the trust; 13- (5) "Unitrust", a trust for which net income is a 14-unitrust amount. The term "unitrust" includes an express 15-unitrust; 16- (6) "Unitrust amount", an amount computed by 17-multiplying a determined value of a trust by a determined 18-percentage. For a unitrust administered under a unitrust 19-policy, the term "unitrust amount" means the applicable 20-value multiplied by the unitrust rate; 21- (7) "Unitrust policy", a policy described in sections 22-469.479 to 469.487 and adopted under section 469.475; 23- (8) "Unitrust rate", the rate used to compute the 24-unitrust amount for a unitrust administered under a unitrust 25-policy. 26- 469.473. 1. Except as otherwise provided in 1-subsection 2 of this section, sections 469.471 to 469.487 2-apply to: 3- (1) An income trust, unless the terms of the trust 4-expressly prohibit use of sections 469.471 to 469.487 by a 5-specific reference to these sections or an explicit 6-expression of intent that net income not be calculated as a 7-unitrust amount; and 8- (2) An express unitrust, except to the extent the 9-terms of the trust explicitly: 10- SB 1468 74- (a) Prohibit use of sections 469.471 to 469.487 by a 11-specific reference to such sections; 12- (b) Prohibit conversion to an income trust; or 13- (c) Limit changes to the method of calculating the 14-unitrust amount. 15- 2. Sections 469.471 to 469.487 do not apply to a trust 16-described in 26 U.S.C. Section 170(f)(2)(B), 642(c)(5), 17-664(d), 2702(a)(3)(A)(ii) or (iii), or 2702(b), as amended. 18- 3. An income trust to which sections 469.471 to 19-469.487 apply under subdivision (1) of subsection 1 of this 20-section may be converted to a unitrust under sections 21-469.471 to 469.487 regardless of the terms of the trust 22-concerning distributions. Conversion to a unitrust under 23-sections 469.471 to 469.487 does not affect other terms of 24-the trust concerning distributions of income or principal. 25- 4. Sections 469.471 to 469.487 apply to an estate only 26-to the extent a trust is a beneficiary of the estate. To 27-the extent of the trust's interest in the estate, the estate 28-may be administered as a unitrust, the administration of the 29-estate as a unitrust may be discontinued, or the percentage 30-or method used to calculate the unitrust amount may be 31-changed, in the same manner as for a trust under sections 32-469.471 to 469.487. 33- 5. Sections 469.471 to 469.487 do not create a duty to 34-take or consider action under sections 469.471 to 469.487 or 35-to inform a beneficiary about the applicability of sections 36-469.471 to 469.487. 37- 6. A fiduciary that in good faith takes or fails to 38-take an action under sections 469.471 to 469.487 is not 39-liable to a person affected by the action or inaction. 40- 469.475. 1. A fiduciary, without court approval, by 1-complying with subsections 2 and 6 of this section, may: 2- SB 1468 75- (1) Convert an income trust to a unitrust if the 3-fiduciary adopts in a record a unitrust policy for the trust 4-providing: 5- (a) That, in administering the trust, the net income 6-of the trust will be a unitrust amount rather than net 7-income determined without regard to sections 469.471 to 8-469.487; and 9- (b) The percentage and method used to calculate the 10-unitrust amount; 11- (2) Change the percentage or method used to calculate 12-a unitrust amount for a unitrust if the fiduciary adopts in 13-a record a unitrust policy or an amendment or replacement of 14-a unitrust policy providing changes in the percentage or 15-method used to calculate the unitrust amount; or 16- (3) Convert a unitrust to an income trust if the 17-fiduciary adopts in a record a determination that, in 18-administering the trust, the net income of the trust will be 19-net income determined without regard to sections 469.471 to 20-469.487 rather than a unitrust amount. 21- 2. A fiduciary may take an action under subsection 1 22-of this section if: 23- (1) The fiduciary determines that the action will 24-assist the fiduciary to administer a trust impartially; 25- (2) The fiduciary sends a notice in a record, in the 26-manner required by section 469.477, describing and proposing 27-to take the action; 28- (3) The fiduciary sends a copy of the notice under 29-subdivision (2) of this subsection to each settlor of the 30-trust that is: 31- (a) If an individual, living; or 32- (b) If not an individual, in existence; 33- SB 1468 76- (4) At least one member of each class of the qualified 34-beneficiaries described under section 456.1-103 receiving 35-the notice under subdivision (2) of this subsection is: 36- (a) If an individual, legally competent; 37- (b) If not an individual, in existence; or 38- (c) Represented in the manner provided in subsection 2 39-of section 469.477; and 40- (5) The fiduciary does not receive, by the date 41-specified in the notice under subdivision (5) of subsection 42-4 of section 469.477, an objection in a record to the action 43-proposed under subdivision (2) of this subsection from a 44-person to which the notice under subdivision (2) of this 45-subsection is sent. 46- 3. If a fiduciary receives, not later than the date 47-stated in the notice under subdivision (5) of subsection 4 48-of section 469.477, an objection in a record described in 49-subdivision (4) of subsection 4 of section 469.477 to a 50-proposed action, the fiduciary or a beneficiary may request 51-the court to have the proposed action taken as proposed, 52-taken with modifications, or prevented. A person described 53-in subsection 1 of section 469.477 may oppose the proposed 54-action in the proceeding under this subsection, whether or 55-not the person: 56- (1) Consented under subsection 3 of section 469.477; or 57- (2) Objected under subdivision (4) of subsection 4 of 58-section 469.477. 59- 4. If, after sending a notice under subdivision (2) of 60-subsection 2 of this section, a fiduciary decides not to 61-take the action proposed in the notice, the fiduciary shall 62-notify in a record each person described in subsection 1 of 63-section 469.477 of the decision not to take the action and 64-the reasons for the decision. 65- SB 1468 77- 5. If a beneficiary requests in a record that a 66-fiduciary take an action described in subsection 1 of this 67-section and the fiduciary declines to act or does not act 68-within ninety days after receiving the request, the 69-beneficiary may request the court to direct the fiduciary to 70-take the action requested. 71- 6. In deciding whether and how to take an action 72-authorized by subsection 1 of this section, or whether and 73-how to respond to a request by a beneficiary under 74-subsection 5 of this section, a fiduciary shall consider all 75-factors relevant to the trust and the beneficiaries, 76-including relevant factors in subsection 5 of section 77-469.403. 78- 7. A fiduciary may release or delegate the power to 79-convert an income trust to a unitrust under subdivision (1) 80-of subsection 1 of this section, change the percentage or 81-method used to calculate a unitrust amount under subdivision 82-(2) of subsection 1 of this section, or convert a unitrust 83-to an income trust under subdivision (3) of subsection 1 of 84-this section, for a reason described in subsection 7 of 85-section 469.405 and in the manner described in subsection 8 86-of section 469.405. 87- 469.477. 1. A notice required by subdivision (3) of 1-subsection 2 of section 469.475 shall be sent in a manner 2-authorized under section 456.1-109 to: 3- (1) The qualified beneficiaries defined in section 4-456.1-103; 5- (2) Each person acting as trust protector under 6-section 456.8-808; and 7- (3) Each person that is granted a power over the trust 8-by the terms of the trust, to the extent the power is 9-exercisable when the person is not then serving as a trustee: 10- SB 1468 78- (a) Including a: 11- a. Power over the investment, management, or 12-distribution of trust property or other matters of trust 13-administration; and 14- b. Power to appoint or remove a trustee or person 15-described in this paragraph; and 16- (b) Excluding a: 17- a. Power of appointment; 18- b. Power of a beneficiary over the trust, to the 19-extent the exercise or nonexercise of the power affects the 20-beneficial interest of the beneficiary or another 21-beneficiary represented by the beneficiary under sections 22-456.3-301 to 456.3-305 with respect to the exercise or 23-nonexercise of the power; and 24- c. Power over the trust if the terms of the trust 25-provide that the power is held in a nonfiduciary capacity 26-and the power shall be held in a nonfiduciary capacity to 27-achieve a tax objective under Title 26 of the United States 28-Code, as amended. 29- 2. The representation provisions of sections 456.3-301 30-to 456.3-305 apply to notice under this section. 31- 3. A person may consent in a record at any time to 32-action proposed under subdivision (2) of subsection 2 of 33-section 469.475. A notice required by subdivision (2) of 34-subsection 2 of section 469.475 need not be sent to a person 35-that consents under this subsection. 36- 4. A notice required by subdivision (2) of subsection 37-2 of section 469.475 shall include: 38- (1) The action proposed under subdivision (2) of 39-subsection 2 of section 469.475; 40- SB 1468 79- (2) For a conversion of an income trust to a unitrust, 41-a copy of the unitrust policy adopted under subdivision (1) 42-of subsection 1 of section 469.475; 43- (3) For a change in the percentage or method used to 44-calculate the unitrust amount, a copy of the unitrust policy 45-or amendment or replacement of the unitrust policy adopted 46-under subdivision (2) of subsection 1 of section 469.475; 47- (4) A statement that the person to which the notice is 48-sent may object to the proposed action by stating in a 49-record the basis for the objection and sending or delivering 50-the record to the fiduciary; 51- (5) The date by which an objection under subdivision 52-(4) of this subsection shall be received by the fiduciary, 53-which shall be at least thirty days after the date the 54-notice is sent; 55- (6) The date on which the action is proposed to be 56-taken and the date on which the action is proposed to take 57-effect; 58- (7) The name and contact information of the fiduciary; 59-and 60- (8) The name and contact information of a person that 61-may be contacted for additional information. 62- 469.479. 1. In administering a unitrust under 1-sections 469.471 to 469.487, a fiduciary shall follow a 2-unitrust policy adopted under subdivision (1) or (2) of 3-subsection 1 of section 469.475 or amended or replaced under 4-subdivision (2) of subsection 1 of section 469.475. 5- 2. A unitrust policy shall provide: 6- (1) The unitrust rate or the method for determining 7-the unitrust rate under section 469.481; 8- (2) The method for determining the applicable value 9-under section 469.483; and 10- SB 1468 80- (3) The rules described in sections 469.481 to 469.487 11-that apply in the administration of the unitrust, whether 12-the rules are: 13- (a) Mandatory, as provided in subsection 1 of section 14-469.483 and subsection 1 of section 469.485; or 15- (b) Optional, as provided in section 469.481, 16-subsection 2 of section 469.483, subsection 2 of section 17-469.485, and subsection 1 of section 469.487, to the extent 18-the fiduciary elects to adopt such rules. 19- 469.481. 1. Except as otherwise provided in 1-subdivision (1) of subsection 2 of section 469.487, a 2-unitrust rate may be: 3- (1) A fixed unitrust rate; or 4- (2) A unitrust rate that is determined for each period 5-using: 6- (a) A market index or other published data; or 7- (b) A mathematical blend of market indices or other 8-published data over a stated number of preceding periods. 9- 2. Except as otherwise provided in subdivision (1) of 10-subsection 2 of section 469.487, a unitrust policy may 11-provide: 12- (1) A limit on how high the unitrust rate determined 13-under subdivision (2) of subsection 1 of this section may 14-rise; 15- (2) A limit on how low the unitrust rate determined 16-under subdivision (2) of subsection 1 of this section may 17-fall; 18- (3) A limit on how much the unitrust rate determined 19-under subdivision (2) of subsection 1 of this section may 20-increase over the unitrust rate for the preceding period or 21-a mathematical blend of unitrust rates over a stated number 22-of preceding periods; 23- SB 1468 81- (4) A limit on how much the unitrust rate determined 24-under subdivision (2) of subsection 1 of this section may 25-decrease below the unitrust rate for the preceding period or 26-a mathematical blend of unitrust rates over a stated number 27-of preceding periods; or 28- (5) A mathematical blend of any of the unitrust rates 29-determined under subdivision (2) of subsection 1 of this 30-section and subdivisions (1) to (4) of this subsection. 31- 469.483. 1. A unitrust policy shall provide the 1-method for determining the fair market value of an asset for 2-the purpose of determining the unitrust amount, including: 3- (1) The frequency of valuing the asset, which need not 4-require a valuation in every period; and 5- (2) The date for valuing the asset in each period in 6-which the asset is valued. 7- 2. Except as otherwise provided in subdivision (2) of 8-subsection 2 of section 469.487, a unitrust policy may 9-provide methods for determining the amount of the net fair 10-market value of the trust to take into account in 11-determining the applicable value, including: 12- (1) Obtaining an appraisal of an asset for which fair 13-market value is not readily available; 14- (2) Exclusion of specific assets or groups or types of 15-assets; 16- (3) Other exceptions or modifications of the treatment 17-of specific assets or groups or types of assets; 18- (4) Identification and treatment of cash or property 19-held for distribution; 20- (5) Use of: 21- (a) An average of fair market values over a stated 22-number of preceding periods; or 23- SB 1468 82- (b) Another mathematical blend of fair market values 24-over a stated number of preceding periods; 25- (6) A limit on how much the applicable value of all 26-assets, groups of assets, or individual assets may increase 27-over: 28- (a) The corresponding applicable value for the 29-preceding period; or 30- (b) A mathematical blend of applicable values over a 31-stated number of preceding periods; 32- (7) A limit on how much the applicable value of all 33-assets, groups of assets, or individual assets may decrease 34-below: 35- (a) The corresponding applicable value for the 36-preceding period; or 37- (b) A mathematical blend of applicable values over a 38-stated number of preceding periods; 39- (8) The treatment of accrued income and other features 40-of an asset that affect value; and 41- (9) Determining the liabilities of the trust, 42-including treatment of liabilities to conform with the 43-treatment of assets under subdivisions (1) to (8) of this 44-subsection. 45- 469.485. 1. A unitrust policy shall provide the 1-period used under sections 469.481 and 469.483. Except as 2-otherwise provided in subdivision (3) of subsection 2 of 3-section 469.481, the period may be: 4- (1) A calendar year; 5- (2) A twelve-month period other than a calendar year; 6- (3) A calendar quarter; 7- (4) A three-month period other than a calendar 8-quarter; or 9- (5) Another period. 10- SB 1468 83- 2. Except as otherwise provided in subsection 2 of 11-section 469.487, a unitrust policy may provide standards for: 12- (1) Using fewer preceding periods under paragraph (b) 13-of subdivision (2) of subsection 1 of section 469.481 or 14-subdivision (3) or (4) of subsection 2 of section 469.481 if: 15- (a) The trust was not in existence in a preceding 16-period; or 17- (b) Market indices or other published data are not 18-available for a preceding period; 19- (2) Using fewer preceding periods under paragraph (a) 20-or (b) of subdivision (5) of subsection 2 of section 21-469.483, paragraph (b) of subdivision (6) of subsection 2 of 22-section 469.483, or paragraph (b) of subdivision (7) of 23-subsection 2 of section 469.483 if: 24- (a) The trust was not in existence in a preceding 25-period; or 26- (b) Fair market values are not available for a 27-preceding period; and 28- (3) Prorating the unitrust amount on a daily basis for 29-a part of a period in which the trust or the administration 30-of the trust as a unitrust or the interest of any 31-beneficiary commences or terminates. 32- 469.487. 1. A unitrust policy may: 1- (1) Provide methods and standards for: 2- (a) Determining the timing of distributions; 3- (b) Making distributions in cash or in kind or partly 4-in cash and partly in kind; or 5- (c) Correcting an underpayment or overpayment to a 6-beneficiary based on the unitrust amount if there is an 7-error in calculating the unitrust amount; 8- (2) Specify sources and the order of sources, 9-including categories of income for federal income tax 10- SB 1468 84-purposes, from which distributions of a unitrust amount are 11-paid; or 12- (3) Provide other standards and rules the fiduciary 13-determines serve the interests of the beneficiaries. 14- 2. If a trust qualifies for a special tax benefit or a 15-fiduciary is not an independent person: 16- (1) The unitrust rate established under section 17-469.481 shall not be less than three percent or more than 18-five percent; 19- (2) The only provisions of section 469.483 that apply 20-are subsection 1 of section 469.483; subdivisions (1), (4), 21-and (9) of subsection 2 of section 469.483; and paragraph 22-(a) of subdivision (5) of subsection 2 of section 469.483; 23- (3) The only period that may be used under section 24-469.485 is a calendar year under subdivision (1) of 25-subsection 1 of section 469.485; and 26- (4) The only other provisions of section 469.485 that 27-apply are paragraph (a) of subdivision (2) of subsection 2 28-of section 469.485 and subdivision (3) of subsection 2 of 29-section 469.485. 30- 513.430. 1. The following property shall be exempt 1-from attachment and execution to the extent of any person's 2-interest therein: 3- (1) Household furnishings, household goods, wearing 4-apparel, appliances, books, animals, crops or musical 5-instruments that are held primarily for personal, family or 6-household use of such person or a dependent of such person, 7-not to exceed three thousand dollars in value in the 8-aggregate; 9- (2) A wedding ring not to exceed one thousand five 10-hundred dollars in value and other jewelry held primarily 11-for the personal, family or household use of such person or 12- SB 1468 85-a dependent of such person, not to exceed five hundred 13-dollars in value in the aggregate; 14- (3) Any other property of any kind, not to exceed in 15-value six hundred dollars in the aggregate; 16- (4) Any implements or professional books or tools of 17-the trade of such person or the trade of a dependent of such 18-person not to exceed three thousand dollars in value in the 19-aggregate; 20- (5) Any motor vehicles, not to exceed three thousand 21-dollars in value in the aggregate; 22- (6) Any mobile home used as the principal residence 23-but not attached to real property in which the debtor has a 24-fee interest, not to exceed five thousand dollars in value; 25- (7) Any one or more unmatured life insurance contracts 26-owned by such person, other than a credit life insurance 27-contract, and up to fifteen thousand dollars of any matured 28-life insurance proceeds for actual funeral, cremation, or 29-burial expenses where the deceased is the spouse, child, or 30-parent of the beneficiary; 31- (8) The amount of any accrued dividend or interest 32-under, or loan value of, any one or more unmatured life 33-insurance contracts owned by such person under which the 34-insured is such person or an individual of whom such person 35-is a dependent; provided, however, that if proceedings under 36-Title 11 of the United States Code are commenced by or 37-against such person, the amount exempt in such proceedings 38-shall not exceed in value one hundred fifty thousand dollars 39-in the aggregate less any amount of property of such person 40-transferred by the life insurance company or fraternal 41-benefit society to itself in good faith if such transfer is 42-to pay a premium or to carry out a nonforfeiture insurance 43-option and is required to be so transferred automatically 44- SB 1468 86-under a life insurance contract with such company or society 45-that was entered into before commencement of such 46-proceedings. No amount of any accrued dividend or interest 47-under, or loan value of, any such life insurance contracts 48-shall be exempt from any claim for child support. 49-Notwithstanding anything to the contrary, no such amount 50-shall be exempt in such proceedings under any such insurance 51-contract which was purchased by such person within one year 52-prior to the commencement of such proceedings; 53- (9) Professionally prescribed health aids for such 54-person or a dependent of such person; 55- (10) Such person's right to receive: 56- (a) A Social Security benefit, unemployment 57-compensation or a public assistance benefit; 58- (b) A veteran's benefit; 59- (c) A disability, illness or unemployment benefit; 60- (d) Alimony, support or separate maintenance, not to 61-exceed seven hundred fifty dollars a month; 62- (e) a. Any payment under a stock bonus plan, pension 63-plan, disability or death benefit plan, profit-sharing plan, 64-nonpublic retirement plan or any plan described, defined, or 65-established pursuant to section 456.014, the person's right 66-to a participant account in any deferred compensation 67-program offered by the state of Missouri or any of its 68-political subdivisions, or annuity or similar plan or 69-contract on account of illness, disability, death, age or 70-length of service, to the extent reasonably necessary for 71-the support of such person and any dependent of such person 72-unless: 73- (i) Such plan or contract was established by or under 74-the auspices of an insider that employed such person at the 75-time such person's rights under such plan or contract arose; 76- SB 1468 87- (ii) Such payment is on account of age or length of 77-service; and 78- (iii) Such plan or contract does not qualify under 79-Section 401(a), 403(a), 403(b), 408, 408A or 409 of the 80-Internal Revenue Code of 1986, as amended, (26 U.S.C. 81-Section 401(a), 403(a), 403(b), 408, 408A or 409). 82- b. Notwithstanding the exemption provided in 83-subparagraph a. of this paragraph, any such payment to any 84-person shall be subject to attachment or execution pursuant 85-to a qualified domestic relations order, as defined by 86-Section 414(p) of the Internal Revenue Code of 1986 (26 87-U.S.C. Section 414(p)), as amended, issued by a court in any 88-proceeding for dissolution of marriage or legal separation 89-or a proceeding for disposition of property following 90-dissolution of marriage by a court which lacked personal 91-jurisdiction over the absent spouse or lacked jurisdiction 92-to dispose of marital property at the time of the original 93-judgment of dissolution; 94- (f) Any money or assets, payable to a participant or 95-beneficiary from, or any interest of any participant or 96-beneficiary in, a retirement plan, profit-sharing plan, 97-health savings plan, or similar plan, including an inherited 98-account or plan, that is qualified under Section 401(a), 99-403(a), 403(b), 408, 408A or 409 of the Internal Revenue 100-Code of 1986 (26 U.S.C. Section 401(a), 403(a), 403(b), 408, 101-408A, or 409), as amended, whether such participant's or 102-beneficiary's interest arises by inheritance, designation, 103-appointment, or otherwise, except as provided in this 104-paragraph. Any plan or arrangement described in this 105-paragraph shall not be exempt from the claim of an alternate 106-payee under a qualified domestic relations order or assignee 107-pursuant to a final judgment of dissolution of marriage or 108- SB 1468 88-legal separation; however, the interest of any and all 109-alternate payees under a qualified domestic relations order 110-or assignees pursuant to a final judgment of dissolution of 111-marriage or legal separation shall be exempt from any and 112-all claims of any creditor, other than the state of Missouri 113-through its department of social services, as of the time 114-the interest is awarded or received, and continues to be 115-exempt thereafter. As used in this paragraph, the terms 116-"alternate payee" and "qualified domestic relations order" 117-have the meaning given to them in Section 414(p) of the 118-Internal Revenue Code of 1986 (26 U.S.C. Section 414(p)), as 119-amended. If proceedings under Title 11 of the United States 120-Code are commenced by or against such person, no amount of 121-funds shall be exempt in such proceedings under any such 122-plan, contract, or trust which is fraudulent as defined in 123-subsection 2 of section 428.024 and for the period such 124-person participated within three years prior to the 125-commencement of such proceedings. For the purposes of this 126-section, when the fraudulently conveyed funds are recovered 127-and after, such funds shall be deducted and then treated as 128-though the funds had never been contributed to the plan, 129-contract, or trust; 130- (11) The debtor's right to receive, or property that 131-is traceable to, a payment on account of the wrongful death 132-of an individual of whom the debtor was a dependent, to the 133-extent reasonably necessary for the support of the debtor 134-and any dependent of the debtor; 135- (12) Firearms, firearm accessories, and ammunition, 136-not to exceed one thousand five hundred dollars in value in 137-the aggregate; 138- (13) Any moneys accruing to and deposited in 139-individual savings accounts or individual deposit accounts 140- SB 1468 89-under sections 166.400 to 166.456 or sections 166.500 to 141-166.529, subject to the following provisions: 142- (a) This subdivision shall apply to any proceeding 143-that: 144- a. Is filed on or after January 1, 2022; or 145- b. Was filed before January 1, 2022, and is pending or 146-on appeal after January 1, 2022; 147- (b) Except as provided by paragraph (c) of this 148-subdivision, if the designated beneficiary of an individual 149-savings account or individual deposit account established 150-under sections 166.400 to 166.456 or sections 166.500 to 151-166.529 is a lineal descendant of the account owner, all 152-moneys in the account shall be exempt from any claims of 153-creditors of the account owner or designated beneficiary; 154- (c) The provisions of paragraph (b) of this 155-subdivision shall not apply to: 156- a. Claims of any creditor of an account owner as to 157-amounts contributed within a two-year period preceding the 158-date of the filing of a bankruptcy petition under 11 U.S.C. 159-Section 101 et seq., as amended; or 160- b. Claims of any creditor of an account owner as to 161-amounts contributed within a one-year period preceding an 162-execution on judgment for such claims against the account 163-owner. 164- 2. Nothing in this section shall be interpreted to 165-exempt from attachment or execution for a valid judicial or 166-administrative order for the payment of child support or 167-maintenance any money or assets, payable to a participant or 168-beneficiary from, or any interest of any participant or 169-beneficiary in, a retirement plan which is qualified 170-pursuant to Sections 408 and 408A of the Internal Revenue 171-Code of 1986 (26 U.S.C. Sections 408 and 408A), as amended. 172- SB 1468 90- 536.085. As used in section 536.087, the following 1-terms mean: 2- (1) "Agency proceeding", an adversary proceeding in a 3-contested case pursuant to this chapter in which the state 4-is represented by counsel, but does not include proceedings 5-for determining the eligibility or entitlement of an 6-individual to a monetary benefit or its equivalent, child 7-custody proceedings, eminent domain proceedings, driver's 8-license proceedings, vehicle registration proceedings, 9-proceedings to establish or fix a rate, or proceedings 10-before the state tax commission; 11- (2) "Party": 12- (a) An individual whose net worth did not exceed two 13-million dollars at the time the civil action or agency 14-proceeding was initiated; or 15- (b) Any owner of an unincorporated business or any 16-partnership, corporation, association, unit of local 17-government or organization, the net worth of which did not 18-exceed seven million dollars at the time the civil action or 19-agency proceeding was initiated, and which had not more than 20-five hundred employees at the time the civil action or 21-agency proceeding was initiated; 22- (3) "Prevails", obtains a favorable order, decision, 23-judgment, or dismissal in a civil action or agency 24-proceeding; 25- (4) "Reasonable fees and expenses" includes the 26-reasonable expenses of expert witnesses, the reasonable cost 27-of any study, analysis, engineering report, test, or project 28-which is found by the court or agency to be necessary for 29-the preparation of the party's case, and reasonable attorney 30-or agent fees. The amount of fees awarded as reasonable 31-fees and expenses shall be based upon prevailing market 32- SB 1468 91-rates for the kind and quality of the services furnished, 33-except that no expert witness shall be compensated at a rate 34-in excess of the highest rate of compensation for expert 35-witnesses paid by the state in the type of civil action or 36-agency proceeding[, and attorney fees shall not be awarded 37-in excess of seventy-five dollars per hour unless the court 38-determines that a special factor, such as the limited 39-availability of qualified attorneys for the proceedings 40-involved, justifies a higher fee]; 41- (5) "State", the state of Missouri, its officers and 42-its agencies, but shall not include political subdivisions 43-of the state. 44- [469.409. 1. Any claim for breach of a 1-trustee's duty to impartially administer a trust 2-related, directly or indirectly, to an 3-adjustment made by a fiduciary to the allocation 4-between principal and income pursuant to 5-subsection 1 of section 469.405 or any 6-allocation made by the fiduciary pursuant to any 7-authority or discretion specified in subsection 8-1 of section 469.403, unless previously barred 9-by adjudication, consent or other limitation, 10-shall be barred as provided in this section. 11- (1) Any such claim brought by a qualified 12-beneficiary is barred if not asserted in a 13-judicial proceeding commenced within two years 14-after the trustee has sent a report to that 15-qualified beneficiary that adequately discloses 16-the facts constituting the claim. 17- (2) Any such claim brought by a 18-beneficiary (other than a qualified beneficiary) 19-with any interest whatsoever in the trust, no 20-matter how remote or contingent, or whether or 21-not the beneficiary is ascertainable or has the 22-capacity to contract, is barred if not asserted 23-in a judicial proceeding commenced within two 24-years after the first to occur of: 25- SB 1468 92- (a) The date the trustee sent a report to 26-all qualified beneficiaries that adequately 27-discloses the facts constituting the claim; or 28- (b) The date the trustee sent a report to 29-a person that represents the beneficiary under 30-the provisions of subdivision (2) of subsection 31-2 of this section. 32- 2. For purposes of this section the 33-following rules shall apply: 34- (1) A report adequately discloses the 35-facts constituting a claim if it provides 36-sufficient information so that the beneficiary 37-should know of the claim or reasonably should 38-have inquired into its existence; 39- (2) Section 469.402 shall apply in 40-determining whether a beneficiary (including a 41-qualified beneficiary) has received notice for 42-purposes of this section; 43- (3) The determination of the identity of 44-all qualified beneficiaries shall be made on the 45-date the report is deemed to have been sent; and 46- (4) This section does not preclude an 47-action to recover for fraud or misrepresentation 48-related to the report.] 49- [469.411. 1. (1) If the provisions of 1-this section apply to a trust, the unitrust 2-amount determined for each accounting year of 3-the trust shall be a percentage between three 4-and five percent of the average net fair market 5-value of the trust, as of the first day of the 6-trust's current accounting year. The percentage 7-applicable to a trust shall be that percentage 8-specified by the terms of the governing 9-instrument or by the election made in accordance 10-with subdivision (2) of subsection 5 of this 11-section. 12- (2) The unitrust amount for the current 13-accounting year computed pursuant to this 14-section shall be proportionately reduced for any 15-distributions, in whole or in part, other than 16-distributions of the unitrust amount, and for 17-any payments of expenses, including debts, 18-disbursements and taxes, from the trust within a 19- SB 1468 93-current accounting year that the trustee 20-determines to be material and substantial, and 21-shall be proportionately increased for the 22-receipt, other than a receipt that represents a 23-return on investment, of any additional property 24-into the trust within a current accounting year. 25- (3) For purposes of this section, the net 26-fair market values of the assets held in the 27-trust on the first business day of a prior 28-accounting quarter shall be adjusted to reflect 29-any reduction, in the case of a distribution or 30-payment, or increase, in the case of a receipt, 31-for the prior accounting year pursuant to 32-subdivision (1) of this subsection, as if the 33-distribution, payment or receipt had occurred on 34-the first day of the prior accounting year. 35- (4) In the case of a short accounting 36-period, the trustee shall prorate the unitrust 37-amount on a daily basis. 38- (5) In the case where the net fair market 39-value of an asset held in the trust has been 40-incorrectly determined in any quarter, the 41-unitrust amount shall be increased in the case 42-of an undervaluation, or be decreased in the 43-case of an overvaluation, by an amount equal to 44-the difference between the unitrust amount 45-determined based on the correct valuation of the 46-asset and the unitrust amount originally 47-determined. 48- 2. As used in this section, the following 49-terms mean: 50- (1) "Average net fair market value", a 51-rolling average of the fair market value of the 52-assets held in the trust on the first business 53-day of the lessor of the number of accounting 54-quarters of the trust from the date of inception 55-of the trust to the determination of the trust's 56-average net fair market value, or twelve 57-accounting quarters of the trust, regardless of 58-whether this section applied to the 59-ascertainment of net income for all valuation 60-quarters; 61- SB 1468 94- (2) "Current accounting year", the 62-accounting period of the trust for which the 63-unitrust amount is being determined. 64- 3. In determining the average net fair 65-market value of the assets held in the trust, 66-there shall not be included the value of: 67- (1) Any residential property or any 68-tangible personal property that, as of the first 69-business day of the current valuation year, one 70-or more income beneficiaries of the trust have 71-or had the right to occupy, or have or had the 72-right to possess or control, other than in a 73-capacity as trustee, and instead the right of 74-occupancy or the right to possession or control 75-shall be deemed to be the unitrust amount with 76-respect to the residential property or the 77-tangible personal property; or 78- (2) Any asset specifically given to a 79-beneficiary under the terms of the trust and the 80-return on investment on that asset, which return 81-on investment shall be distributable to the 82-beneficiary. 83- 4. In determining the average net fair 84-market value of the assets held in the trust 85-pursuant to subsection 1 of this section, the 86-trustee shall, not less often than annually, 87-determine the fair market value of each asset of 88-the trust that consists primarily of real 89-property or other property that is not traded on 90-a regular basis in an active market by appraisal 91-or other reasonable method or estimate, and that 92-determination, if made reasonably and in good 93-faith, shall be conclusive as to all persons 94-interested in the trust. Any claim based on a 95-determination made pursuant to this subsection 96-shall be barred if not asserted in a judicial 97-proceeding brought by any beneficiary with any 98-interest whatsoever in the trust within two 99-years after the trustee has sent a report to all 100-qualified beneficiaries that adequately 101-discloses the facts constituting the claim. The 102-rules set forth in subsection 2 of section 103-469.409 shall apply to the barring of claims 104-pursuant to this subsection. 105- SB 1468 95- 5. This section shall apply to the 106-following trusts: 107- (1) Any trust created after August 28, 108-2001, with respect to which the terms of the 109-trust clearly manifest an intent that this 110-section apply; 111- (2) Any trust created under an instrument 112-that became irrevocable on, before, or after 113-August 28, 2001, if the trustee, in the 114-trustee's discretion, elects to have this 115-section apply unless the instrument creating the 116-trust specifically prohibits an election under 117-this subdivision. The trustee shall deliver 118-notice to all qualified beneficiaries and the 119-settlor of the trust, if he or she is then 120-living, of the trustee's intent to make such an 121-election at least sixty days before making that 122-election. The trustee shall have sole authority 123-to make the election. Section 469.402 shall 124-apply for all purposes of this subdivision. An 125-action or order by any court shall not be 126-required. The election shall be made by a 127-signed writing delivered to the settlor of the 128-trust, if he or she is then living, and to all 129-qualified beneficiaries. The election is 130-irrevocable, unless revoked by order of the 131-court having jurisdiction of the trust. The 132-election may specify the percentage used to 133-determine the unitrust amount pursuant to this 134-section, provided that such percentage is 135-between three and five percent, or if no 136-percentage is specified, then that percentage 137-shall be three percent. In making an election 138-pursuant to this subsection, the trustee shall 139-be subject to the same limitations and 140-conditions as apply to an adjustment between 141-income and principal pursuant to subsections 3 142-and 4 of section 469.405; and 143- (3) No action of any kind based on an 144-election made by a trustee pursuant to 145-subdivision (2) of this subsection shall be 146-brought against the trustee by any beneficiary 147-of that trust three years from the effective 148-date of that election. 149- SB 1468 96- 6. (1) Once the provisions of this 150-section become applicable to a trust, the net 151-income of the trust shall be the unitrust amount. 152- (2) Unless otherwise provided by the 153-governing instrument, the unitrust amount 154-distributed each year shall be paid from the 155-following sources for that year up to the full 156-value of the unitrust amount in the following 157-order: 158- (a) Net income as determined if the trust 159-were not a unitrust; 160- (b) Other ordinary income as determined 161-for federal income tax purposes; 162- (c) Assets of the trust principal for 163-which there is a readily available market value; 164-and 165- (d) Other trust principal. 166- (3) Additionally, the trustee may allocate 167-to trust income for each taxable year of the 168-trust, or portion thereof: 169- (a) Net short-term capital gain described 170-in the Internal Revenue Code, 26 U.S.C. Section 171-1222(5), for such year, or portion thereof, but 172-only to the extent that the amount so allocated 173-together with all other amounts to trust income, 174-as determined under the provisions of this 175-chapter without regard to this section, for such 176-year, or portion thereof, does not exceed the 177-unitrust amount for such year, or portion 178-thereof; 179- (b) Net long-term capital gain described 180-in the Internal Revenue Code, 26 U.S.C. Section 181-1222(7), for such year, or portion thereof, but 182-only to the extent that the amount so allocated 183-together with all other amounts, including 184-amounts described in paragraph (a) of this 185-subdivision, allocated to trust income for such 186-year, or portion thereof, does not exceed the 187-unitrust amount for such year, or portion 188-thereof. 189- 7. A trust with respect to which this 190-section applies on August 28, 2011, may 191-calculate the unitrust amount in accordance with 192-the provisions of this section, as it existed 193- SB 1468 97-either before or after such date, as the trustee 194-of such trust shall determine in a writing kept 195-with the records of the trust in the trustee's 196-discretion.] 197- [469.461. 1. A fiduciary may make 1-adjustments between principal and income to 2-offset the shifting of economic interests or tax 3-benefits between income beneficiaries and 4-remainder beneficiaries which arise from: 5- (1) Elections and decisions, other than 6-those described in subsection 2 of this section, 7-that the fiduciary makes from time to time 8-regarding tax matters; 9- (2) An income tax or any other tax that is 10-imposed upon the fiduciary or a beneficiary as a 11-result of a transaction involving or a 12-distribution from the estate or trust; or 13- (3) The ownership by an estate or trust of 14-an interest in an entity whose taxable income, 15-whether or not distributed, is includable in the 16-taxable income of the estate, trust or a 17-beneficiary. 18- 2. If the amount of an estate tax marital 19-deduction or charitable contribution deduction 20-is reduced because a fiduciary deducts an amount 21-paid from principal for income tax purposes 22-instead of deducting it for estate tax purposes, 23-and as a result estate taxes paid from principal 24-are increased and income taxes paid by an 25-estate, trust or beneficiary are decreased, each 26-estate, trust or beneficiary that benefits from 27-the decrease in income tax shall reimburse the 28-principal from which the increase in estate tax 29-is paid. The total reimbursement shall equal 30-the increase in the estate tax to the extent 31-that the principal used to pay the increase 32-would have qualified for a marital deduction or 33-charitable contribution deduction but for the 34-payment. The proportionate share of the 35-reimbursement for each estate, trust or 36-beneficiary whose income taxes are reduced shall 37-be the same as its proportionate share of the 38- SB 1468 98-total decrease in income tax. An estate or 39-trust shall reimburse principal from income.] 40-✓+ Section A. Sections 82.1025, 214.330, 452.335, 452.375,+452.410, 452.423, 456.4 -420, 469.401, 469.402, 469.403,+469.405, 469.409, 469.411, 469.413, 469.415, 469.417, 469.419,+469.421, 469.423, 469.425, 469.427, 469.429, 469.431, 469.432,+469.433, 469.435, 469.437, 469.439, 469.441, 469.443, 469.445,+469.447, 469.449, 469.451, 469.453, 469.455, 469.457, 469.459,+469.461, 469.463, 469.465, 469.467, 488.426, 513.430, 536.085,+and 537.528, RSMo, are repealed and fifty -nine new sections+enacted in lieu the reof, to be known as sections 82.1025,+214.330, 452.335, 452.375, 452.381, 452.410, 452.423, 456.4 -+420, 469.399, 469.401, 469.402, 469.403, 469.404, 469.405,+469.413, 469.415, 469.417, 469.419, 469.421, 469.423, 469.425,+469.427, 469.429, 469.431, 469.432, 469.433, 469.435, 469.437,+469.439, 469.441, 469.443, 469.445, 469.446, 469.447, 469.449,+469.451, 469.453, 469.455, 469.456, 469.457, 469.459, 469.462,+469.463, 469.464, 469.465, 469.467, 469.471, 469.473, 469.475,++ 2+469.477, 469.479, 469.481, 469.483, 469.485, 469.487, 488.426,+513.430, 536.085, and 537.529, to read as follows:+ 82.1025. 1. Sections 82.1025, 82.1027 and 82.1030+apply to a nuisance located within the boundaries of:+ (1) Any city not within a county;+ (2) Any home rule city with at least three hundred+fifty thousand inhabitants which is located in more than one+county;+ (3) Any home rule city with more than one hundred+sixty thousand but fewer than two hundred thousand+inhabitants; [or]+ (4) Any home rule city with more than seventy-one+thousand but fewer than seventy-nine thousand inhabitants; or+ (5) Any city with more than one hundred five thousand+but fewer than one hundred twenty-five thousand inhabitants.+ 2. Any property owner who owns property within one+thousand two hundred feet of a parcel of property that is+alleged to be a nuisance may bring a nuisance action under+this section against the offending property owner for the+amount of damage created by such nuisance to the value of+the petitioner's property, including diminution in value of+the petitioner's property, and court costs.+ 3. An action for injunctive relief to abate a nuisance+may be brought under this section by:+ (1) Anyone who owns property within one thousand two+hundred feet to a property which is alleged to be a+nuisance; or+ (2) A neighborhood organization, as defined in section+82.1027, on behalf of any person or persons who own property+within the boundaries of the neighborhood or neighborhoods+described in the articles of incorporation or bylaws of the+neighborhood organization and who could maintain a nuisance+action under this section or under the common law of private++ 3+nuisance, or on its own behalf with respect to a nuisance on+property anywhere within the boundaries of the neighborhood+or neighborhoods.+ 4. An action shall not be brought under this section+until sixty days after the party who brings the action has+mailed notice of intent to bring an action under this+section, postage prepaid, to:+ (1) The tenant, if any, or to "occupant" if the+identity of the tenant cannot be reasonably ascertained, at+the property's address; and+ (2) The property owner of record at the last known+address of the property owner on file with the county or+city, or, if the property owner is a corporation or other+type of limited liability company, to the property owner's+registered agent at the agent's address of record;+that a nuisance exists and that legal action may be taken+against the owner of the property if the nuisance is not+eliminated within sixty days after the date on the mailed+notice. If the notice is returned unclaimed or refused,+designated by the post office to be undeliverable, or signed+for by a person other than the addressee, then adequate and+sufficient notice shall be provided by posting a copy of the+notice on the property where the nuisance allegedly is+occurring. A sworn affidavit by the person who mailed or+posted the notice describing the date and manner that notice+was given shall be sufficient evidence to establish that the+notice was given. The notice shall specify:+ (a) The act or condition that constitutes the nuisance;+ (b) The date the nuisance was first discovered;+ (c) The address of the property and location on the+property where the act or condition that constitutes the+nuisance is allegedly occurring or exists; and++ 4+ (d) The relief sought in the action.+ 5. A copy of a notice of citation issued by the city+or county that shows the date the citation was issued shall+be prima facie evidence of whether and for how long the+property has been in violation of the code or ordinance+provisions described in the citation.+ 6. A proceeding under this section shall:+ (1) Be heard at the earliest practicable date; and+ (2) Be expedited in every way.+ 7. When a property owner or neighborhood organization+brings an action under this section for injunctive relief to+abate a nuisance, a prima facie case for injunctive relief+shall be made upon proof that a nuisance exists on the+property. An action for injunctive relief to abate a+nuisance shall be heard by the court without a jury and+shall not require proof that the party bringing the action+has sustained damage or loss as a result of the nuisance.+ 8. When a property owner or neighborhood organization+bringing the action prevails in such action, such property+owner or organization may be entitled to an award for+attorneys' fees and expenses, based on the amount of time+reasonably expended, as ordered by the court, which award+for attorneys' fees and expenses shall be entered as a+judgment against the owner of the property on which the act+or condition constituting the nuisance occurred or was+located.+ 9. In addition to any other penalties or costs+associated with the abatement of a nuisance that are imposed+pursuant to sections 82.1025 to 82.1031, any person or+entity that is not a resident of this state and who is an+owner of property found to have a code or ordinance+violation shall be subject to a civil fine of two thousand+dollars per violation. Any property found to have a code or++ 5+ordinance violation and that is structurally unsafe or poses+a threat to persons or other property shall have such+nuisance abated within one year of the code or ordinance+violation. Any such property that is not abated within one+year, and any property with unpaid civil fines within two+years of the imposition of the fine shall be subject to sale+by the taxing jurisdiction in which the property is+located. The property shall be sold in an amount that will+satisfy the costs incurred for abating the property as well+as any outstanding civil fines. Such sale shall coincide+with the sale of delinquent properties under chapters 140+and 141.+ 214.330. 1. (1) The endowed care trust fund required+by sections 214.270 to 214.410 shall be permanently set+aside in trust or in accordance with the provisions of+subsection 2 of this section. The trustee of the endowed+care trust shall be a state or federally chartered financial+institution authorized to exercise trust powers in+Missouri. The contact information for a trust officer or+duly appointed representative of the trustee with knowledge+and access to the trust fund accounting and trust fund+records must be disclosed to the office or its duly+authorized representative upon request.+ (2) The trust fund records, including all trust fund+accounting records, shall be maintained in the state of+Missouri at all times or shall be electronically stored so+that the records may be made available in the state of+Missouri within fifteen business days of receipt of a+written request. The operator of an endowed care cemetery+shall maintain a current name and address of the trustee and+the records custodian for the endowed care trust fund and+shall supply such information to the office, or its+representative, upon request.++ 6+ (3) Missouri law shall control all endowed care trust+funds and the Missouri courts shall have jurisdiction over+endowed care trusts regardless of where records may be kept+or various administrative tasks may be performed.+ 2. An endowed care trust fund shall be administered in+accordance with Missouri law governing trusts, including but+not limited to the applicable provisions of chapters 456 and+469, except as specifically provided in this subsection or+where the provisions of sections 214.270 to 214.410 provide+differently, provided that a cemetery operator shall not in+any circumstances be authorized to restrict, enlarge,+change, or modify the requirements of this section or the+provisions of chapters 456 and 469 by agreement or otherwise.+ (1) Income and principal of an endowed care trust fund+shall be determined under the provisions of law applicable+to trusts, except that the [provisions of section 469.405+shall not apply] trustee shall have:+ (a) No power of adjustment under section 469.405;+ (b) No power of conversion either from an income trust+to a unitrust or from a unitrust to an income trust under+section 469.475;+ (c) No power or discretion to determine or modify the+unitrust rate, as established in the terms of the endowed+care trust agreement; and+ (d) No discretion to determine applicable value for+purposes of computing the unitrust amount beyond that+granted by law and exercised solely for reasons of+administrative convenience and not affect the size of+distributions.+In determining applicable value under section 469.473,+values over a three-year period if available, or the+duration of the trust if shorter, shall be used.++ 7+ (2) No principal shall be distributed from an endowed+care trust fund except to the extent that a unitrust+[election is in effect with respect to such trust under the+provisions of section 469.411] amount is required by the+terms of the endowed care trust fund agreement under+subdivision (6) of this subsection.+ (3) No right to transfer jurisdiction from Missouri+under section 456.1-108 shall exist for endowed care trusts.+ (4) All endowed care trusts shall be irrevocable.+ (5) No trustee shall have the power to terminate an+endowed care trust fund under the provisions of section+456.4-414.+ (6) A unitrust [election made in accordance with the+provisions of chapter 469] definition of income under+sections 469.471 to 469.487 shall be [made] established by+the cemetery operator in the terms of the endowed care trust+fund agreement itself, not by the trustee, and shall not+provide for a unitrust rate exceeding five percent per+annum. The unitrust rate shall be changed only by amendment+to the agreement as provided in this section.+ (7) No contract of insurance shall be deemed a+suitable investment for an endowed care trust fund.+ (8) The income from the endowed care fund may be+distributed to the cemetery operator at least annually on a+date designated by the cemetery operator by record, but no+later than sixty days following the end of the [trust fund]+trust's fiscal year. Any income not distributed within+sixty days following the end of the trust's fiscal year+shall be added to and held as part of the principal of the+trust fund. The cemetery operator may instruct by record+the trustee to distribute less than all the income+distributable for the year if the cemetery operator+determines that the money is not needed.++ 8+ 3. The cemetery operator shall have the duty and+responsibility to apply the income distributed to provide+care and maintenance only for that part of the cemetery+designated as an endowed care section and not for any other+purpose.+ 4. In addition to any other duty, obligation, or+requirement imposed by sections 214.270 to 214.410 or the+endowed care trust agreement, the trustee's duties shall be+the maintenance of records related to the trust and the+accounting for and investment of moneys deposited by the+operator to the endowed care trust fund.+ (1) For the purposes of sections 214.270 to 214.410,+the trustee shall not be deemed responsible for the care,+the maintenance, or the operation of the cemetery, or for+any other matter relating to the cemetery, or the proper+expenditure of funds distributed by the trustee to the+cemetery operator, including, but not limited to, compliance+with environmental laws and regulations.+ (2) With respect to cemetery property maintained by+endowed care funds, the cemetery operator shall be+responsible for the performance of the care and maintenance+of the cemetery property.+ 5. If the endowed care cemetery fund is not+permanently set aside in a trust fund as required by+subsection 1 of this section, then the funds shall be+permanently set aside in an escrow account in the state of+Missouri. Funds in an escrow account shall be placed in an+endowed care trust fund under subsection 1 if the funds in+the escrow account exceed three hundred fifty thousand+dollars, unless otherwise approved by the division for good+cause. The account shall be insured by the Federal Deposit+Insurance Corporation or comparable deposit insurance and+held in a state or federally chartered financial institution++ 9+authorized to do business in Missouri and located in this+state.+ (1) The interest from the escrow account may be+distributed to the cemetery operator at least in annual or+semiannual installments, but not later than six months+following the calendar year. Any interest not distributed+within six months following the end of the calendar year+shall be added to and held as part of the principal of the+account.+ (2) The cemetery operator shall have the duty and+responsibility to apply the interest to provide care and+maintenance only for that part of the cemetery in which+burial space shall have been sold and with respect to which+sales the escrow account shall have been established and not+for any other purpose. The principal of such funds shall be+kept intact. The cemetery operator's duties shall be the+maintenance of records and the accounting for an investment+of moneys deposited by the operator to the escrow account.+For purposes of sections 214.270 to 214.410, the+administrator of the office of endowed care cemeteries shall+not be deemed to be responsible for the care, maintenance,+or operation of the cemetery. With respect to cemetery+property maintained by cemetery care funds, the cemetery+operator shall be responsible for the performance of the+care and maintenance of the cemetery property owned by the+cemetery operator.+ (3) The division may approve an escrow agent if the+escrow agent demonstrates the knowledge, skill, and ability+to handle escrow funds and financial transactions and is of+good moral character.+ 6. The cemetery operator shall be accountable to the+owners of burial space in the cemetery for compliance with+sections 214.270 to 214.410.++ 10+ 7. Excluding funds held in an escrow account, all+endowed care trust funds shall be administered in accordance+with an endowed care trust fund agreement, which shall be+submitted to the office by the cemetery operator for review+and approval. The endowed care cemetery shall be notified+in writing by the office of endowed care cemeteries+regarding the approval or disapproval of the endowed care+trust fund agreement and regarding any changes required to+be made for compliance with sections 214.270 to 214.410 and+the rules and regulations promulgated thereunder.+ 8. All endowed care cemeteries shall be under a+continuing duty to file with the office of endowed care+cemeteries and to submit for prior approval any and all+changes, amendments, or revisions of the endowed care trust+fund agreement at least thirty days before the effective+date of such change, amendment, or revision.+ 9. If the endowed care trust fund agreement, or any+changes, amendments, or revisions filed with the office, are+not disapproved by the office within thirty days after+submission by the cemetery operator, the endowed care trust+fund agreement, or the related change, amendment, or+revision, shall be deemed approved and may be used by the+cemetery operator and the trustee. Notwithstanding any+other provision of this section, the office may review and+disapprove an endowed care trust fund agreement, or any+submitted change, amendment, or revision, after the thirty+days provided herein or at any other time if the agreement+is not in compliance with sections 214.270 to 214.410 or the+rules promulgated thereunder. Notice of disapproval by the+office shall be in writing and delivered to the cemetery+operator and the trustee within ten days of disapproval.+ 10. Funds in an endowed care trust fund or escrow+account may be commingled with endowed care funds for other++ 11+endowed care cemeteries, provided that the cemetery operator+and the trustee shall maintain adequate accounting records+of the disbursements, contributions, and income allocated+for each cemetery.+ 11. By accepting the trusteeship of an endowed care+trust or accepting funds as an escrow agent pursuant to+sections 214.270 to 214.410, the trustee or escrow agent+submits personally to the jurisdiction of the courts of this+state and the office of endowed care cemeteries regarding+the administration of the trust or escrow account. A+trustee or escrow agent shall consent in writing to the+jurisdiction of the state of Missouri and the office in+regards to the trusteeship or the operation of the escrow+account and to the appointment of the office of secretary of+state as its agent for service of process regarding any+administrative or legal actions relating to the trust or the+escrow account, if it has no designated agent for service of+process located in this state. Such consent shall be filed+with the office prior to accepting funds pursuant to+sections 214.270 to 214.410 as trustee or as an escrow agent+on a form provided by the office by rule.+ 452.335. 1. In a proceeding for nonretroactive+invalidity, dissolution of marriage or legal separation, or+a proceeding for maintenance following dissolution of the+marriage by a court which lacked personal jurisdiction over+the absent spouse, the court may grant a maintenance order+to either spouse, but only if it finds that the spouse+seeking maintenance:+ (1) Lacks sufficient property, including marital+property apportioned to him, to provide for his reasonable+needs; and+ (2) Is unable to support himself through appropriate+employment or is the custodian of a child whose condition or++ 12+circumstances make it appropriate that the custodian not be+required to seek employment outside the home.+ 2. The maintenance order shall be in such amounts and+for such periods of time as the court deems just, and after+considering all relevant factors including:+ (1) The financial resources of the party seeking+maintenance, including marital property apportioned to him,+and his ability to meet his needs independently, including+the extent to which a provision for support of a child+living with the party includes a sum for that party as+custodian;+ (2) The time necessary to acquire sufficient education+or training to enable the party seeking maintenance to find+appropriate employment;+ (3) The comparative earning capacity of each spouse;+ (4) The standard of living established during the+marriage;+ (5) The obligations and assets, including the marital+property apportioned to him and the separate property of+each party;+ (6) The duration of the marriage;+ (7) The age, and the physical and emotional condition+of the spouse seeking maintenance;+ (8) The ability of the spouse from whom maintenance is+sought to meet his needs while meeting those of the spouse+seeking maintenance;+ (9) The conduct of the parties during the marriage; and+ (10) Any other relevant factors.+ 3. Notwithstanding the provisions of subsection 2 of+this section to the contrary, a maintenance order shall+terminate upon the payor reaching full retirement age,+unless otherwise agreed to by both parties. For purposes of+this subsection, "full retirement age" shall mean the++ 13+earlier of the date on which the payor is either eligible+for or begins receiving full retirement benefits under the+federal Social Security Act, but shall not mean "early+retirement age" as defined under the federal Social Security+Act, 42 U.S.C. Section 416, as amended. The payor shall+provide the payee reasonable notice in advance of+retirement. Six months notice shall be presumed to be+reasonable.+ 4. The maintenance order shall state if it is+modifiable or nonmodifiable. The court may order+maintenance which includes a termination date. Unless the+maintenance order which includes a termination date is+nonmodifiable, the court may order the maintenance+decreased, increased, terminated, extended, or otherwise+modified based upon a substantial and continuing change of+circumstances which occurred prior to the termination date+of the original order.+ 452.375. 1. As used in this chapter, unless the+context clearly indicates otherwise:+ (1) "Custody" means joint legal custody, sole legal+custody, joint physical custody or sole physical custody or+any combination thereof;+ (2) "Joint legal custody" means that the parents share+the decision-making rights, responsibilities, and authority+relating to the health, education and welfare of the child,+and, unless allocated, apportioned, or decreed, the parents+shall confer with one another in the exercise of decision-+making rights, responsibilities, and authority;+ (3) "Joint physical custody" means an order awarding+each of the parents significant, but not necessarily equal,+periods of time during which a child resides with or is+under the care and supervision of each of the parents.+Joint physical custody shall be shared by the parents in++ 14+such a way as to assure the child of frequent, continuing+and meaningful contact with both parents;+ (4) "Third-party custody" means a third party+designated as a legal and physical custodian pursuant to+subdivision (5) of subsection 5 of this section.+ 2. The court shall determine custody in accordance+with the best interests of the child. There shall be a+rebuttable presumption that an award of equal or+approximately equal parenting time to each parent is in the+best interests of the child. Such presumption is rebuttable+only by a preponderance of the evidence in accordance with+all relevant factors, including, but not limited to, the+factors contained in subdivisions (1) to [(8)] (14) of this+subsection. The presumption may also be rebutted if the+court finds that the parents have reached an agreement on+all issues related to custody, or if the court finds that a+pattern of domestic violence has occurred as set out in+subdivision (6) of this subsection. When the parties have+not reached an agreement on all issues related to custody,+the court shall consider all relevant factors and enter+written findings of fact and conclusions of law, including,+but not limited to, the following:+ (1) The wishes of the child's parents as to custody+and the proposed parenting plan submitted by both parties;+ (2) [The needs of the child for a frequent, continuing+and meaningful relationship with both parents and the+ability and willingness of parents to actively perform their+functions as mother and father for the needs of the child]+The nature and quality of the child's existing relationship+with each parent, including, but not limited to, the child's+need for continuity, stability, and emotional security, and+the ability and willingness of each parent to actively+perform caregiving functions for the needs of the child. In++ 15+evaluating this factor, the court may consider, but shall+not be required to treat as a presumptive or paramount+concern, the frequency or quantity of contact between the+child and each parent, and shall instead weigh the overall+quality of each parent-child relationship against all other+factors enumerated in this subsection;+ (3) The interaction and interrelationship of the child+with parents, siblings, and any other person who may+significantly affect the child's best interests;+ (4) Which parent is more likely to allow the child+frequent, continuing and meaningful contact with the other+parent;+ (5) The child's adjustment to the child's home,+school, and community. The fact that a parent sends his or+her child or children to a home school or FPE school shall+not be the sole factor that a court considers in determining+custody of such child or children;+ (6) The mental and physical health of all individuals+involved, including any history of abuse of any individuals+involved. Where credible evidence is presented that a+parent has a current or prior diagnosis of a mental health+condition that may affect parenting capacity, the court+shall affirmatively evaluate the following:+ (a) The nature and severity of the diagnosed condition;+ (b) Whether the parent is currently engaged in+treatment with a licensed mental health professional,+including, but not limited to, psychotherapy, counseling,+psychiatric care, or medication management;+ (c) The parent's degree of compliance with any+prescribed or recommended treatment plan, including+medication adherence, therapy attendance, and follow-up care;++ 16+ (d) The extent to which the condition, if inadequately+treated or unmanaged, poses a risk to the child's physical+safety, emotional well-being, or developmental needs; and+ (e) Any expert testimony or reports from licensed+mental health professionals regarding the parent's current+functioning, prognosis, and fitness to exercise custodial or+visitation responsibilities.+A diagnosis of a mental health condition alone shall not be+grounds for denying custody or visitation; however, a+parent's demonstrated pattern of noncompliance with+treatment, or refusal to engage in recommended treatment+when noncompliance has resulted in behavior detrimental to+the child, may be considered as a factor weighing against an+award of custody or unsupervised visitation to that parent.+If the court finds that a pattern of domestic violence as+defined in section 455.010 has occurred, and, if the court+also finds that awarding custody to the abusive parent is in+the best interest of the child, then the court shall enter+written findings of fact and conclusions of law. Custody+and visitation rights shall be ordered in a manner that best+protects the child and any other child or children for whom+the parent has custodial or visitation rights, and the+parent or other family or household member who is the victim+of domestic violence from any further harm;+ (7) The child's need for stability, continuity of+care, and consistent routine, as well as the capacity of+each parent to provide a safe, stable, and developmentally+appropriate environment;+ (8) The intention of either parent to relocate the+principal residence of the child; and++ 17+ [(8)] (9) The unobstructed input of a child, free of+coercion and manipulation, as to the child's custodial+arrangement;+ (10) Whether the child's present or past living+conditions have had, or are likely to have, an adverse+effect on the child's physical, mental, moral, or emotional+health or development, including, but not limited to,+exposure to substance abuse, domestic violence, or chronic+instability in the household;+ (11) The ability of each parent to encourage and+facilitate a close and continuing relationship between the+child and the other parent, except where such contact would+be harmful to the child, and the willingness of each parent+to support the child's relationship with the other parent in+a manner free of manipulation, disparagement, or coercion;+ (12) Whether the past pattern of involvement of each+parent with the child reflects a system of values, time+commitment, and mutual support that serves the child's+developmental needs, and the extent to which each parent has+historically participated in caregiving, decision-making,+and engagement with the child's educational, medical, and+extracurricular activities;+ (13) The ability of each parent to place the needs of+the child ahead of his or her own needs, including the+parent's demonstrated capacity for prioritizing the child's+emotional security, developmental requirements, and day-to-+day welfare over personal preferences or conflicts with the+other parent; and+ (14) The impact of any history of domestic violence,+as defined in section 455.010, on the child, regardless of+whether the child was a direct victim, including the effects+of exposure to coercive control, intimidation, or fear++ 18+within the household on the child's emotional,+psychological, and behavioral functioning.+ 3. (1) In any court proceedings relating to custody+of a child, the court shall not award custody or+unsupervised visitation of a child to a parent if such+parent or any person residing with such parent has been+found guilty of, or pled guilty to, any of the following+offenses when a child was the victim:+ (a) A felony violation of section 566.030, 566.031,+566.032, 566.060, 566.061, 566.062, 566.064, 566.067,+566.068, 566.083, 566.100, 566.101, 566.111, 566.151,+566.203, 566.206, 566.209, 566.211, or 566.215;+ (b) A violation of section 568.020;+ (c) A violation of subdivision (2) of subsection 1 of+section 568.060;+ (d) A violation of section 568.065;+ (e) A violation of section 573.200;+ (f) A violation of section 573.205; or+ (g) A violation of section 568.175.+ (2) For all other violations of offenses in chapters+566 and 568 not specifically listed in subdivision (1) of+this subsection or for a violation of an offense committed+in another state when a child is the victim that would be a+violation of chapter 566 or 568 if committed in Missouri,+the court may exercise its discretion in awarding custody or+visitation of a child to a parent if such parent or any+person residing with such parent has been found guilty of,+or pled guilty to, any such offense.+ 4. The general assembly finds and declares that it is+the public policy of this state that [frequent, continuing+and meaningful contact with both parents after the parents+have separated or dissolved their marriage is in the best+interest of the child, except for cases where the court++ 19+specifically finds that such contact is not in the best+interest of the child, and that it is the public policy of+this state to encourage parents to participate in decisions+affecting the health, education and welfare of their+children, and to resolve disputes involving their children+amicably through alternative dispute resolution], when+consistent with the best interests of the child, maintaining+a meaningful relationship with both parents after the+parents have separated or dissolved their marriage should be+facilitated by the court. This policy shall not operate as+a presumption in favor of any particular custody+arrangement, and the court retains full discretion to+determine that the child's safety, emotional well-being,+developmental needs, or other best-interest factors outweigh+the interest in maximizing parenting time with both+parents. It is further the public policy of this state to+encourage parents to participate in decisions affecting the+health, education, and welfare of their children, and to+resolve disputes involving their children amicably through+alternative dispute resolution. In order to effectuate+these policies, the general assembly encourages the court to+enter a temporary parenting plan as early as practicable in+a proceeding under this chapter, consistent with the+provisions of subsection 2 of this section, and, in so+doing, the court shall determine the custody arrangement+[which will best assure both parents participate in such+decisions and have frequent, continuing and meaningful+contact with their children so long as it is in the best+interests of the child] that best serves the child's overall+well-being as measured by the totality of the factors+enumerated in subsection 2 of this section.++ 20+ 5. Prior to awarding the appropriate custody+arrangement in the best interest of the child, the court+shall consider each of the following as follows:+ (1) Joint physical and joint legal custody to both+parents, which shall not be denied solely for the reason+that one parent opposes a joint physical and joint legal+custody award. The residence of one of the parents shall be+designated as the address of the child for mailing and+educational purposes;+ (2) Joint physical custody with one party granted sole+legal custody. The residence of one of the parents shall be+designated as the address of the child for mailing and+educational purposes;+ (3) Joint legal custody with one party granted sole+physical custody;+ (4) Sole custody to either parent; or+ (5) Third-party custody or visitation:+ (a) When the court finds that each parent is unfit,+unsuitable, or unable to be a custodian, or the welfare of+the child requires, and it is in the best interests of the+child, then custody, temporary custody or visitation may be+awarded to a person related by consanguinity or affinity to+the child. If no person related to the child by+consanguinity or affinity is willing to accept custody, then+the court may award custody to any other person or persons+deemed by the court to be suitable and able to provide an+adequate and stable environment for the child. Before the+court awards custody, temporary custody or visitation to a+third person under this subdivision, the court shall make+that person a party to the action;+ (b) Under the provisions of this subsection, any+person may petition the court to intervene as a party in+interest at any time as provided by supreme court rule.++ 21+ 6. If the parties have not agreed to a custodial+arrangement, or the court determines such arrangement is not+in the best interest of the child, the court shall include a+written finding in the judgment or order based on the public+policy in subsection 4 of this section and each of the+factors listed in subdivisions (1) to [(8)] (14) of+subsection 2 of this section detailing the specific relevant+factors that made a particular arrangement in the best+interest of the child. If a proposed custodial arrangement+is rejected by the court, the court shall include a written+finding in the judgment or order detailing the specific+relevant factors resulting in the rejection of such+arrangement.+ 7. Upon a finding by the court that either parent has+refused to exchange information with the other parent, which+shall include but not be limited to information concerning+the health, education and welfare of the child, the court+shall order the parent to comply immediately and to pay the+prevailing party a sum equal to the prevailing party's cost+associated with obtaining the requested information, which+shall include but not be limited to reasonable attorney's+fees and court costs.+ 8. As between the parents of a child, no preference+may be given to either parent in the awarding of custody+because of that parent's age, sex, or financial status, nor+because of the age or sex of the child. The court shall not+presume that a parent, solely because of his or her sex, is+more qualified than the other parent to act as a joint or+sole legal or physical custodian for the child.+ 9. Any judgment providing for custody shall include a+specific written parenting plan setting forth the terms of+such parenting plan arrangements specified in subsection 8+of section 452.310. Such plan may be a parenting plan++ 22+submitted by the parties pursuant to section 452.310 or, in+the absence thereof, a plan determined by the court, but in+all cases, the custody plan approved and ordered by the+court shall be in the court's discretion and shall be in the+best interest of the child.+ 10. After August 28, 2016, every court order+establishing or modifying custody or visitation shall+include the following language: "In the event of+noncompliance with this order, the aggrieved party may file+a verified motion for contempt. If custody, visitation, or+third-party custody is denied or interfered with by a parent+or third party without good cause, the aggrieved person may+file a family access motion with the court stating the+specific facts that constitute a violation of the custody+provisions of the judgment of dissolution, legal separation,+or judgment of paternity. The circuit clerk will provide+the aggrieved party with an explanation of the procedures+for filing a family access motion and a simple form for use+in filing the family access motion. A family access motion+does not require the assistance of legal counsel to prepare+and file.".+ 11. No court shall adopt any local rule, form, or+practice requiring a standardized or default parenting plan+for interim, temporary, or permanent orders or judgments.+Notwithstanding any other provision of law to the contrary,+a court may enter an interim order in a proceeding under+this chapter, provided that the interim order shall not+contain any provisions about child custody or a parenting+schedule or plan without first providing the parties with+notice and a hearing, unless the parties otherwise agree.+ 12. Unless a parent has been denied custody rights+pursuant to this section or visitation rights under section+452.400, both parents shall have access to records and++ 23+information pertaining to a minor child including, but not+limited to, medical, dental, and school records. If the+parent without custody has been granted restricted or+supervised visitation because the court has found that the+parent with custody or any child has been the victim of+domestic violence, as defined in section 455.010, by the+parent without custody, the court may order that the reports+and records made available pursuant to this subsection not+include the address of the parent with custody or the+child. A court shall order that the reports and records+made available under this subsection not include the address+of the parent with custody if the parent with custody is a+participant in the address confidentiality program under+section 589.663. Unless a parent has been denied custody+rights pursuant to this section or visitation rights under+section 452.400, any judgment of dissolution or other+applicable court order shall specifically allow both parents+access to such records and reports.+ 13. Except as otherwise precluded by state or federal+law, if any individual, professional, public or private+institution or organization denies access or fails to+provide or disclose any and all records and information,+including, but not limited to, past and present dental,+medical and school records pertaining to a minor child, to+either parent upon the written request of such parent, the+court shall, upon its finding that the individual,+professional, public or private institution or organization+denied such request without good cause, order that party to+comply immediately with such request and to pay to the+prevailing party all costs incurred, including, but not+limited to, attorney's fees and court costs associated with+obtaining the requested information.++ 24+ 14. An award of joint custody does not preclude an+award of child support pursuant to section 452.340 and+applicable supreme court rules. The court shall consider+the factors contained in section 452.340 and applicable+supreme court rules in determining an amount reasonable or+necessary for the support of the child.+ 15. If the court finds that domestic violence or abuse+as defined in section 455.010 has occurred, the court shall+make specific findings of fact to show that the custody or+visitation arrangement ordered by the court best protects+the child and the parent or other family or household member+who is the victim of domestic violence, as defined in+section 455.010, and any other children for whom such parent+has custodial or visitation rights from any further harm.+ 452.381. 1. During the pendency of an action seeking+a modification of any judgment pertaining to child custody+or visitation, upon the motion of any party and with notice+to all other parties and after a hearing, the court may make+temporary orders relative to the custody and visitation of+the child subject to the judgment being modified. Any such+order shall remain in effect until the disposition of the+motion to modify or until further order of the court.+ 2. Notwithstanding the provisions of subsection 1 of+this section to the contrary, an order entered relative to+custody or visitation under this section may be entered+without notice to opposing parties if the court finds that+an emergency exists, the nature of which requires the court+to act before opposing parties can be heard in opposition,+including, but not limited to, an emergency in which the+child faces immediate or imminent risk of physical harm,+emotional harm, psychological injury, or medical neglect+because of:++ 25+ (1) A parent's deteriorating mental health, as+evidenced by observable behavior, professional reports, or+other credible evidence;+ (2) A parent's failure to comply with a prescribed or+recommended treatment plan for a diagnosed mental health+condition, where such noncompliance has resulted in or is+reasonably likely to result in conduct that endangers the+child;+ (3) Reports from licensed medical or mental health+professionals indicating a parent's instability,+decompensation, or inability to safely exercise custodial or+visitation responsibilities;+ (4) A pattern of emotional volatility, coercive+behavior, or erratic conduct by a parent that creates a+substantial risk of harm to the child; or+ (5) A parent's refusal to submit to a mental health+evaluation when ordered by the court pursuant to subsection+7 of this section or section 452.375.+In all such cases, the order shall be for a period not to+exceed fifteen days or until further order of the court, and+written notice of the issuance of any such order and the+reasons for it shall be given to opposing parties, along+with notice of the date, time, and place that a hearing on+the continuation of the order will be held.+ 3. No temporary order shall deny parenting time to a+parent or any other party granted custody or visitation+under the judgment for which modification is sought, unless+the court finds that parenting time is likely to cause+physical or emotional harm to the child.+ 4. If temporary parenting time is ordered, the court+may also order temporary child support or temporarily modify+any existing child support orders if requested by any party.++ 26+ 5. A temporary parenting plan issued under this+section shall not prejudice the rights of the parties or the+child that are to be adjudicated at subsequent hearings in+the proceeding.+ 6. Dismissal of the motion to modify shall+automatically vacate any temporary order issued under this+section.+ 7. In any proceeding under this section in which a+parent's mental health is at issue, the court may order an+independent mental health evaluation of any parent by a+licensed mental health professional. The evaluator shall+submit a written report to the court addressing the parent's+current diagnosis, treatment compliance, functional capacity+for parenting, and any recommended safeguards or conditions+on custody or visitation. The cost of such evaluation shall+be apportioned by the court as it deems equitable.+ 452.410. 1. Except as provided in subsection 2 of+this section, the court shall not modify a prior custody+decree unless it has jurisdiction under the provisions of+section 452.745 and it finds, upon the basis of facts that+have arisen since the prior decree or that were unknown to+the court at the time of the prior decree, that a change has+occurred in the circumstances of the child or his custodian+and that the modification is necessary to serve the best+interests of the child. Notwithstanding any other provision+of this section or sections 452.375 and 452.400 to the+contrary, any custody order entered by any court in this+state or any other state may, subject to jurisdictional+requirements, be modified to allow for joint custody or+visitation only in accordance with section 452.375, 452.400,+452.402, or 452.403.+ 2. If either parent files a motion to modify an award+of joint legal custody or joint physical custody, each party++ 27+shall be entitled to a change of judge as provided by+supreme court rule.+ 3. If the parties have agreed to terms for+modification of custody or visitation of the child, the+parties may submit to the court a proposed parenting plan+signed, under oath, by all parties having rights of custody+or visitation under the existing custody or visitation+judgment. The proposed plan shall be accompanied by a+motion, signed under oath by all parties, requesting a+modification of the existing parenting plan and no statement+of any changes in circumstances shall be required. If the+court determines that the proposed plan is in the child's+best interests, then the court shall enter an order granting+custody or visitation according to the proposed parenting+plan as soon as possible following the filing.+ 4. As used in this section and in cases where one or+more children subject to a custody order have special needs+or disabilities, a change of circumstances may include one+parent's neglect or harm of the best interests of the child+or children with special needs or disabilities. A change of+circumstances under this section may also include a+custodial parent's failure to comply with a prescribed or+recommended treatment plan for a diagnosed mental health+condition, where such noncompliance has materially impaired+the parent's ability to meet the particular caregiving,+therapeutic, medical, or developmental needs of the child or+children with special needs or disabilities. In evaluating+a motion to modify under this section, the court shall+consider any evidence of the parent's current mental health+status, treatment compliance, and the impact of any+noncompliance on the child's safety, stability, and access+to necessary services.++ 28+ 452.423. 1. In all proceedings for child custody or+for dissolution of marriage or legal separation where+custody, visitation, or support of a child is a contested+issue, the court may appoint a guardian ad litem.+Disqualification of a guardian ad litem shall be ordered in+any legal proceeding only pursuant to this chapter, upon the+filing of a written application by any party within ten days+of appointment, or within ten days of August 28, 1998, if+the appointment occurs prior to August 28, 1998. Each party+shall be entitled to one disqualification of a guardian ad+litem appointed under this subsection in each proceeding,+except a party may be entitled to additional+disqualifications of a guardian ad litem for good cause+shown.+ 2. The court shall appoint a guardian ad litem in any+proceeding in which child abuse or neglect is alleged.+ 3. The guardian ad litem shall:+ (1) Be the legal representative of the child at the+hearing, and may examine, cross-examine, subpoena witnesses+and offer testimony;+ (2) Prior to the hearing, conduct all necessary+interviews with persons having contact with or knowledge of+the child in order to ascertain the child's wishes,+feelings, attachments and attitudes. If appropriate, the+child should be interviewed;+ (3) Review relevant medical, educational, and+therapeutic records and consult treating professionals when+appropriate, assess special medical or developmental needs,+and evaluate household stability and continuity of care; and+ (4) Request the juvenile officer to cause a petition+to be filed in the juvenile division of the circuit court if+the guardian ad litem believes the child alleged to be+abused or neglected is in danger.++ 29+ 4. The guardian ad litem shall submit a written report+summarizing the investigative steps taken and the factual+basis for any recommendations. The court shall review the+report to ensure compliance with the provisions of this+section and any other duties required under law prior to+adopting any of the recommendations contained within.+ 5. The appointing judge shall require the guardian ad+litem to faithfully discharge such guardian ad litem's+duties, and upon failure to do so shall discharge such+guardian ad litem and appoint another. The judge in making+appointments pursuant to this section shall give preference+to persons who served as guardian ad litem for the child in+the earlier proceeding, unless there is a reason on the+record for not giving such preference.+ [5.] 6. The guardian ad litem shall be awarded a+reasonable fee for such services to be set by the court.+The court, in its discretion, may:+ (1) Issue a direct payment order to the parties. If a+party fails to comply with the court's direct payment order,+the court may find such party to be in contempt of court; or+ (2) Award such fees as a judgment to be paid by any+party to the proceedings or from public funds. Such an+award of guardian fees shall constitute a final judgment in+favor of the guardian ad litem. Such final judgment shall+be enforceable against the parties in accordance with+chapter 513.+ 7. A guardian ad litem appointed under this section+shall have received training in child development, trauma-+informed practices, domestic violence dynamics, coercive+control, mental health disorders affecting parenting+capacity, and considerations for children with special+needs. Such training may be part of any training or++ 30+education otherwise required of a guardian ad litem under+law.+ 456.4-420. 1. If a trust instrument containing a no-+contest clause is or has become irrevocable, an interested+person may file a petition to the court for [an+interlocutory] a determination whether a particular [motion,+petition, or other] claim for relief by the interested+person would trigger application of the no-contest clause+[or would otherwise trigger a forfeiture] that is+enforceable under applicable law and public policy.+ 2. The petition described in subsection 1 of this+section shall be verified under oath. The petition [may]+shall be filed by an interested person either as a separate+judicial proceeding, or brought with other claims for relief+in a single judicial proceeding, all in the manner+prescribed generally for such proceedings under this+chapter. If a petition is joined with other claims for+relief, the interested person shall seek, and the court+shall enter, its order or judgment on the petition before+proceeding any further with [any other claim for relief+joined therein] the matter. In ruling on such a petition,+the court shall consider the text of the clause, the context+to the terms of the trust instrument as a whole, and in the+context of the verified factual allegations in the+petition. No evidence beyond the pleadings and the trust+instrument shall be taken except as required to resolve an+ambiguity in the no-contest clause.+ 3. An order or judgment [determining a petition]+making a determination described in subsection 1 of this+section shall have the effect set forth in subsections 4 and+5 of this section, and shall be subject to appeal as with+other final judgments. [If the] An order that disposes of+fewer than all claims for relief in a [judicial]++ 31+proceeding[, that order] under this section is subject to+[interlocutory] immediate appeal in accordance with the+applicable rules for taking such an appeal. If an+[interlocutory] appeal is taken, the court may stay the+pending judicial proceeding until final disposition of said+appeal on such terms and conditions as the court deems+reasonable and proper under the circumstances. A final+ruling on the applicability of a no-contest clause shall not+preclude any later filing and adjudication of other claims+related to the trust.+ 4. An order or judgment, in whole or in part, on a+petition described in subsection 1 of this section shall+result in the no-contest clause being enforceable to the+extent of the court's ruling, and shall govern application+of the no-contest clause to the extent that the interested+person then proceeds forward with the claims described+therein. In the event such an [interlocutory] order or+judgment is vacated, reversed, or otherwise modified on+appeal, no interested person shall be prejudiced by any+reliance, through action, inaction, or otherwise, on the+order or judgment prior to final disposition of the appeal.+ 5. An order or judgment shall have effect [only] as to+the claims, specific trust terms, and factual basis recited+in the petition, and shall relate to all actions taken by+all parties in the suit under the Missouri supreme court+rules of civil procedure and this chapter. If claims are+later filed or amended that are materially different than+those upon which the order or judgment is based, then to the+extent such new claims are raised, the party in whose favor+the order or judgment was entered shall have no protection+from enforcement of the no-contest clause otherwise afforded+by the order and judgment entered under this section.++ 32+ 6. For purposes of this section, a "no-contest clause"+shall mean a provision in a trust instrument purporting to+rescind a donative transfer to, or a fiduciary appointment+of, any person, or that otherwise effects a forfeiture of+some or all of an interested person's beneficial interest in+a trust estate as a result of some action taken by the+beneficiary. This definition shall not be construed in any+way as determining whether a no-contest clause is+enforceable under applicable law and public policy in a+particular factual situation. As used in this section, the+term "no-contest clause" shall also mean an "in terrorem+clause".+ 7. A no-contest clause is not enforceable against an+interested person in[, but not limited to,] the following+circumstances:+ (1) Filing a motion, petition, or other claim for+relief objecting to the jurisdiction or venue of the court+over a proceeding concerning a trust, or over any person+joined, or attempted to be joined, in such a proceeding;+ (2) Filing a motion, petition, or other claim for+relief concerning an accounting, report, or notice that has+or should have been made by a trustee, provided the+interested person otherwise has standing to do so under+applicable law, including, but not limited to, section 456.6-+603;+ (3) Filing a motion, petition, or other claim for+relief under chapter 475 concerning the appointment of a+guardian or conservator for the settlor;+ (4) Filing a motion, petition, or other claim for+relief under chapter 404 concerning the settlor;+ (5) Disclosure to any person of information concerning+a trust instrument or that is relevant to a proceeding+before the court concerning the trust instrument or property++ 33+of the trust estate, unless such disclosure is otherwise+prohibited by law;+ (6) Filing a motion, pleading, or other claim for+relief seeking approval of a nonjudicial settlement+agreement concerning a trust instrument, as set forth in+section 456.1-111;+ (7) [To the extent] Filing a petition [under+subsection 1 of] pursuant to this section, provided the+petition is limited to the [procedure] procedures and+[purpose] purposes described [therein] in this section;+ (8) Participation in a suit consistent with the+Missouri supreme court rules of civil procedure by any+interested person where the interested person has not+asserted any affirmative claim for relief;+ (9) As to the interested persons party to an action,+to the extent the court determines that the application of+the no-contest clause is void or unenforceable as against+the public policy of this state;+ (10) The scope of the no-contest clause does not+include the factual allegations of the petition as they+apply to the specific terms of the trust; and+ (11) A no-contest clause that seeks to cause a+forfeiture against a beneficiary challenging a trust term+that would otherwise be prohibited under subsection 2 of+section 456.1-105 or section 456.10-1008.+ 8. An interested person that does not seek a+determination in accordance with the provisions of this+section is not thereafter prohibited in any manner from+challenging the validity or application of a no-contest+clause in a proceeding without the protections afforded by+this section.++ 34+ 9. In any proceeding brought under this section, the+court may award costs, expenses, and attorneys' fees to any+party, as provided in section 456.10-1004.+ 469.399. Sections 469.399 to 469.487 shall be known+and may be cited as the "Missouri Uniform Fiduciary Income+and Principal Act".+ 469.401. As used in sections [469.401] 469.399 to+[469.467] 469.487, the following terms mean:+ (1) "Accounting period", a calendar year, unless+[another twelve-month period is selected by] a fiduciary+selects another period of twelve calendar months or+approximately twelve calendar months. The term "accounting+period" includes a [portion] part of a calendar year or+[other twelve-month] another period [that] of twelve+calendar months or approximately twelve calendar months that+begins when an income interest begins or ends when an income+interest ends;+ (2) "Asset-backed security", a security that is+serviced primarily by the cash flows of a discrete pool of+fixed or revolving receivables or other financial assets+that by their terms convert into cash within a finite time.+The term "asset-backed security" includes rights or other+assets that ensure the servicing or timely distribution of+proceeds to the holder of the asset-backed security. The+term "asset-backed security" does not include an asset to+which section 469.423, 469.437, or 469.447 applies;+ (3) "Beneficiary", includes:+ (a) For a trust:+ a. A current beneficiary, including a current income+beneficiary and a beneficiary that may receive only+principal;+ b. A remainder beneficiary; and+ c. Any other successor beneficiary;++ 35+ (b) For an estate, an heir, legatee, and devisee [of a+decedent's estate, and an income beneficiary and a remainder+beneficiary of a trust, including any type of entity that+has a beneficial interest in either an estate or a trust];+and+ (c) For a life estate or term interest, a person that+holds a life estate, term interest, or remainder or other+interest following a life estate or term interest;+ (4) "Court", any court in this state having+jurisdiction relating to a trust, estate, life estate, or+other term interest described in subdivision (2) of+subsection 1 of section 469.402;+ (5) "Current income beneficiary", a beneficiary to+which a fiduciary may distribute net income, whether or not+the fiduciary also may distribute principal to the+beneficiary;+ (6) "Distribution", a payment or transfer by a+fiduciary to a beneficiary in the beneficiary's capacity as+a beneficiary, made under the terms of the trust, without+consideration other than the beneficiary's right to receive+the payment or transfer under the terms of the trust. The+terms "distribute", "distributed", and "distributee" have+corresponding meanings;+ (7) "Estate", a decedent's estate. The term "estate"+includes the property of the decedent as the estate is+originally constituted and the property of the estate as it+exists at any time during administration;+ [(3)] (8) "Fiduciary", includes a trustee, trust+protector determined under section 456.8-808, personal+representative, [trustee, executor, administrator, successor+personal representative, special administrator and any other+person performing substantially the same function] life+tenant, holder of a term interest, and person acting under a++ 36+delegation from a fiduciary. The term "fiduciary" includes+a person that holds property for a successor beneficiary+whose interest may be affected by an allocation of receipts+and expenditures between income and principal. If there are+two or more cofiduciaries, the term "fiduciary" includes all+cofiduciaries acting under the terms of the trust and+applicable law;+ [(4)] (9) "Income", money or other property [that] a+fiduciary receives as current return from [a] principal+[asset, including a portion]. The term "income" includes a+part of receipts from a sale, exchange, or liquidation of a+principal asset, [as] to the extent provided in sections+469.423 to 469.449;+ [(5) "Income beneficiary", a person to whom net income+of a trust is or may be payable;+ (6)] (10) "Income interest", the right of [an] a+current income beneficiary to receive all or part of net+income, whether the terms of the trust require [it] the net+income to be distributed or authorize [it] the net income to+be distributed in the [trustee's] fiduciary's discretion.+The term "income interest" includes the right of a current+beneficiary to use property held by a fiduciary;+ (11) "Independent person", a person that is not:+ (a) For a trust:+ a. A qualified beneficiary as defined in section 456.1-+103;+ b. A settlor of the trust; or+ c. An individual whose legal obligation to support a+beneficiary may be satisfied by a distribution from the+trust;+ (b) For an estate, a beneficiary;++ 37+ (c) A spouse, parent, brother, sister, or issue of an+individual described in paragraph (a) or (b) of this+subdivision;+ (d) A corporation, partnership, limited liability+company, or other entity in which persons described in+paragraphs (a) to (c) of this subdivision, in the aggregate,+have voting control; or+ (e) An employee of a person described in paragraph+(a), (b), (c), or (d) of this subdivision;+ [(7)] (12) "Mandatory income interest", the right of+[an] a current income beneficiary to receive net income that+the terms of the trust require the fiduciary to distribute;+ [(8)] (13) "Net income", [if section 469.411 applies+to the trust, the unitrust amount, or if section 469.411+does not apply to the trust,] the total [receipts allocated+to income] allocations during an accounting period to income+under the terms of a trust and sections 469.399 to 469.487+minus the disbursements [made from income during the same+period, plus or minus transfers pursuant to sections 469.401+to 469.467 to or from income] during the [same] accounting+period, other than distributions, allocated to income under+the terms of the trust and sections 469.399 to 469.487. To+the extent the trust is a unitrust under sections 469.471 to+469.487, the term "net income" means the unitrust amount+determined under sections 469.471 to 469.487. The term "net+income" includes an adjustment from principal to income+under section 469.405. The term "net income" does not+include an adjustment from income to principal under section+469.405;+ [(9)] (14) "Person", an individual, [corporation,+business trust,] estate, trust, [partnership, limited+liability company, association, joint venture] business or+nonprofit entity, public corporation, government[,] or++ 38+governmental subdivision, agency, or instrumentality,+[public corporation] or [any] other legal [or commercial]+entity;+ (15) "Personal representative", an executor,+administrator, successor personal representative, special+administrator, or person that performs substantially the+same function with respect to an estate under the law+governing the person's status;+ [(10)] (16) "Principal", property held in trust for+distribution to [a remainder], production of income for, or+use by a current or successor beneficiary [when the trust+terminates];+ [(11) "Qualified beneficiary", a beneficiary defined+in section 456.1-103;+ (12) "Remainder beneficiary", a person entitled to+receive principal when an income interest ends;+ (13)] (17) "Record", information that is inscribed on+a tangible medium or that is stored in an electronic or+other medium and is retrievable in perceivable form;+ (18) "Settlor", a person, including a testator, that+creates or contributes property to a trust. If more than+one person creates or contributes property to a trust, the+term "settlor" includes each person, to the extent of the+trust property attributable to that person's contribution,+except to the extent another person has the power to revoke+or withdraw that portion;+ (19) "Special tax benefit":+ (a) Exclusion of a transfer to a trust from gifts+described in 26 U.S.C. Section 2503(b), as amended, because+of the qualification of an income interest in the trust as a+present interest in property;+ (b) Status as a qualified subchapter S trust described+in 26 U.S.C. Section 1361(d)(3), as amended, at a time the++ 39+trust holds stock of an S corporation described in 26 U.S.C.+Section 1361(a)(1), as amended;+ (c) An estate or gift tax marital deduction for a+transfer to a trust under 26 U.S.C. Section 2056 or 2523, as+amended, which depends or depended in whole or in part on+the right of the settlor's spouse to receive the net income+of the trust;+ (d) Exemption in whole or in part of a trust from the+federal generation-skipping transfer tax imposed by 26+U.S.C. Section 2601, as amended, because the trust was+irrevocable on September 25, 1985, if there is any+possibility that:+ a. A taxable distribution, as defined in 26 U.S.C.+Section 2612(b), as amended, could be made from the trust; or+ b. A taxable termination, as defined in 26 U.S.C.+Section 2612(a), as amended, could occur with respect to the+trust; or+ (e) An inclusion ratio, as defined in 26 U.S.C.+Section 2642(a), as amended, of the trust which is less than+one, if there is any possibility that:+ a. A taxable distribution, as defined in 26 U.S.C.+Section 2612(b), as amended, could be made from the trust; or+ b. A taxable termination, as defined in 26 U.S.C.+Section 2612(a), as amended, could occur with respect to the+trust;+ (20) "Successive interest", the interest of a+successor beneficiary;+ (21) "Successor beneficiary", a person entitled to+receive income or principal or to use property when an+income interest or other current interest ends;+ (22) "Terms of a trust":++ 40+ (a) Except as otherwise provided in paragraph (b) of+this subdivision, the manifestation of the settlor's [or+decedent's] intent regarding a trust's provisions as:+ a. Expressed in [a manner which is] the trust+instrument; or+ b. Established by other evidence that would be+admissible [as proof] in a judicial proceeding[, whether by+written or spoken words or by conduct];+ (b) The trust's provisions as established, determined,+or amended by:+ a. A trustee or trust director in accordance with+applicable law;+ b. Court order; or+ c. A nonjudicial settlement agreement under section+456.1-111;+ (c) For an estate, a will; or+ (d) For a life estate or term interest, the+corresponding manifestation of the rights of the+beneficiaries;+ (23) "Trust":+ (a) Includes:+ a. An express trust, private or charitable, with+additions to the trust, wherever and however created; and+ b. A trust created or determined by judgment or decree+under which the trust is to be administered in the manner of+an express trust; and+ (b) Does not include:+ a. A constructive trust;+ b. A resulting trust, conservatorship, guardianship,+multi-party account, custodial arrangement for a minor,+business trust, voting trust, security arrangement,+liquidation trust, or trust for the primary purpose of+paying debts, dividends, interest, salaries, wages, profits,++ 41+pensions, retirement benefits, or employee benefits of any+kind; or+ c. An arrangement under which a person is a nominee,+escrowee, or agent for another;+ [(14)] (24) "Trustee", a person, other than a personal+representative, that owns or holds property for the benefit+of a beneficiary. The term "trustee" includes an original,+additional, or successor trustee, whether or not appointed+or confirmed by a court;+ [(15) "Unitrust amount", net income as defined by+section 469.411]+ (25) "Will", any testamentary instrument recognized by+applicable law that makes a legally effective disposition of+an individual's property, effective at the individual's+death. The term "will" includes a codicil or other+amendment to a testamentary instrument.+ 469.402. 1. Except as otherwise provided in the terms+of a trust or sections 469.399 to 469.487, the provisions of+sections [456.3-301] 469.399 to [456.3-305 shall] 469.487+apply to [sections 469.401 to 469.467 for all purposes]:+ (1) A trust or estate; and+ (2) A life estate or other term interest in which the+interest of one or more persons will be succeeded by the+interest of one or more other persons.+ 2. Except as otherwise provided in the terms of a+trust or sections 469.399 to 469.487, the provisions of+sections 469.399 to 469.487 apply when this state is the+principal place of administration of a trust or estate or+the situs of property that is not held in a trust or estate+and is subject to a life estate or other term interest+described in subdivision (2) of subsection 1 of this+section. By accepting the trusteeship of a trust having its+principal place of administration in this state or by moving++ 42+the principal place of administration of a trust to this+state, the trustee submits to the application of sections+469.399 to 469.487 to any matter within the scope of+sections 469.399 to 469.487 involving the trust.+ 469.403. 1. In [allocating receipts and disbursements+to or between principal and income, and with respect to any+matter within the scope of] making an allocation or+determination or exercising discretion under sections+469.413 to 469.421, a fiduciary shall:+ (1) [Shall] Act in good faith, based on what is fair+and reasonable to all beneficiaries;+ (2) Administer a trust or estate [under] impartially,+except to the extent the terms of the trust manifest an+intent that the fiduciary shall or [the will] may favor one+or more beneficiaries;+ (3) Administer the trust or estate in accordance with+the terms of the trust, even if there is a different+provision in sections [469.401] 469.399 to [469.467]+469.487; and+ [(2) May] (4) Administer [a] the trust or estate [by+exercising] in accordance with sections 469.399 to 469.487,+except to the extent the terms of the trust provide+otherwise or authorize the fiduciary to determine otherwise.+ 2. A fiduciary's allocation, determination, or+exercise of discretion pursuant to sections 469.399 to+469.487 is presumed to be fair and reasonable to all+beneficiaries. A fiduciary may exercise a discretionary+power of administration given to the fiduciary by the terms+of the trust [or the will, even if the], and an exercise of+the power that produces a result different from a result+required or permitted by sections [469.401] 469.399 to+[469.467;] 469.487 does not create an inference that the+fiduciary abused the fiduciary's discretion.++ 43+ [(3) Shall administer a trust or estate pursuant]+ 3. A fiduciary shall:+ (1) Add a receipt to [sections 469.401 to 469.467 if]+principal, to the extent neither the terms of the trust [or+the will do not contain a different provision or do not+give] nor sections 469.399 to 469.487 allocate the+[fiduciary a discretionary power of administration] receipt+between income and principal; and+ [(4) Shall add a receipt or] (2) Charge a+disbursement to principal, to the extent [that] neither the+terms of the trust [and] nor sections [469.401] 469.399 to+[469.467 do not provide a rule for allocating the receipt+or] 469.487 allocate the disbursement [to or] between+[principal and] income and principal.+ [2. In exercising the power to adjust pursuant to+section 469.405 or a discretionary power of administration+regarding a matter within the scope of sections 469.401 to+469.467, whether granted by the terms of a trust, a will, or+sections 469.401 to 469.467, a fiduciary shall administer a+trust or estate impartially, based on what is fair and+reasonable to all of the beneficiaries, except to the extent+that the terms of the trust or the will clearly manifest an+intent that the fiduciary shall or may favor one or more of+the beneficiaries. A determination in accordance with+sections 469.401 to 469.467 is presumed to be fair and+reasonable to all of the beneficiaries]+ 4. A fiduciary may exercise the power to adjust under+section 469.405, convert an income trust to a unitrust under+subdivision (1) of subsection 1 of section 469.475, change+the percentage or method used to calculate a unitrust amount+under subdivision (2) of subsection 1 of section 469.475, or+convert a unitrust to an income trust under subdivision (3)+of subsection 1 of section 469.475, if the fiduciary++ 44+determines the exercise of the power will assist the+fiduciary to administer the trust or estate impartially.+ 5. Factors the fiduciary shall consider in making the+determination under subsection 4 of this section include:+ (1) The terms of the trust;+ (2) The nature, distribution standards, and expected+duration of the trust;+ (3) The effect of the allocation rules, including+specific adjustments between income and principal, under+sections 407.413 to 407.461;+ (4) The desirability of liquidity and regularity of+income;+ (5) The desirability of the preservation and+appreciation of principal;+ (6) The extent to which an asset is used or may be+used by a beneficiary;+ (7) The increase or decrease in the value of principal+assets, reasonably determined by the fiduciary;+ (8) Whether and to what extent the terms of the trust+give the fiduciary power to accumulate income or invade+principal or prohibit the fiduciary from accumulating income+or invading principal;+ (9) The extent to which the fiduciary has accumulated+income or invaded principal in preceding accounting periods;+ (10) The effect of current and reasonably expected+economic conditions; and+ (11) The reasonably expected tax consequences of the+exercise of the power.+ 469.404. 1. As used in this section, the term+"fiduciary decision" means:+ (1) A fiduciary's allocation between income and+principal or other determination regarding income and++ 45+principal required or authorized by the terms of the trust+or sections 469.399 to 469.487;+ (2) The fiduciary's exercise or nonexercise of a+discretionary power regarding income and principal granted+by the terms of the trust or sections 469.399 to 469.487,+including the power to adjust under section 469.405, convert+an income trust to a unitrust under subdivision (1) of+subsection 1 of section 469.475, change the percentage or+method used to calculate a unitrust amount under subdivision+(2) of subsection 1 of section 469.475, or convert a+unitrust to an income trust under subdivision (3) of+subsection 1 of section 469.475; or+ (3) The fiduciary's implementation of a decision+described in subdivision (1) or (2) of this subsection.+ 2. The court shall not order a fiduciary to change a+fiduciary decision unless the court determines that the+fiduciary decision was an abuse of the fiduciary's+discretion.+ 3. If the court determines that a fiduciary decision+was an abuse of the fiduciary's discretion, the court may+order a remedy authorized by law, including under section+456.10-1001. To place the beneficiaries in the positions+the beneficiaries would have occupied if there had not been+an abuse of the fiduciary's discretion, the court may order:+ (1) The fiduciary to exercise or refrain from+exercising the power to adjust under section 469.405;+ (2) The fiduciary to exercise or refrain from+exercising the power to convert an income trust to a+unitrust under subdivision (1) of subsection 1 of section+469.475, change the percentage or method used to calculate a+unitrust amount under subdivision (2) of subsection 1 of+section 469.475, or convert a unitrust to an income trust+under subdivision (3) of subsection 1 of section 469.475;++ 46+ (3) The fiduciary to distribute an amount to a+beneficiary;+ (4) A beneficiary to return some or all of a+distribution; or+ (5) The fiduciary to withhold an amount from one or+more future distributions to a beneficiary.+ 4. On petition by a fiduciary for instruction, the+court may determine whether a proposed fiduciary decision+will result in an abuse of the fiduciary's discretion. If+the petition describes the proposed decision, contains+sufficient information to inform the beneficiary of the+reasons for making the proposed decision and the facts on+which the fiduciary relies, and explains how the beneficiary+will be affected by the proposed decision, a beneficiary+that opposes the proposed decision has the burden to+establish that it will result in an abuse of the fiduciary's+discretion.+ 469.405. 1. [A trustee may adjust between principal+and income to the extent the trustee considers necessary if+the trustee invests and manages trust assets as a prudent+investor, the terms of the trust describe the amount that+may or shall be distributed to a beneficiary by referring to+the trust's income, and the trustee determines, after+applying subsection 1 of section 469.403, that the trustee+is unable to comply with subsection 2 of section 469.403]+Except as otherwise provided in the terms of a trust or this+section, a fiduciary, in a record, without court approval,+may adjust between income and principal if the fiduciary+determines the exercise of the power to adjust will assist+the fiduciary to administer the trust or estate impartially.+ 2. This section does not create a duty to exercise or+consider the power to adjust under subsection 1 of this++ 47+section or to inform a beneficiary about the applicability+of this section.+ 3. A fiduciary that in good faith exercises or fails+to exercise the power to adjust under subsection 1 of this+section is not liable to a person affected by the exercise+or failure to exercise.+ [2.] 4. In deciding whether and to what extent to+exercise the power [conferred by] to adjust under subsection+1 of this section, a [trustee] fiduciary shall consider all+factors the fiduciary considers relevant [to the trust and+its beneficiaries], including [the following] relevant+factors [to the extent relevant:] in subsection 5 of section+469.403 and the application of sections 469.423, 469.435,+and 469.445.+ [(1) The nature, purpose and expected duration of the+trust;+ (2) The intent of the settlor;+ (3) The identity and circumstances of the+beneficiaries;+ (4) The needs for liquidity, regularity of income, and+preservation and appreciation of capital;+ (5) The assets held in the trust, including the extent+to which such assets consist of financial assets, interests+in closely held enterprises, tangible and intangible+personal property, or real property, and the extent to which+such assets are used by a beneficiary, and whether such+assets were purchased by the trustee or received from the+settlor;+ (6) The net amount allocated to income pursuant to+sections 469.401 to 469.467, other than this section, and+the increase or decrease in the value of the principal+assets, which the trustee may estimate as to assets for+which market values are not readily available;++ 48+ (7) Whether and to what extent the terms of the trust+give the trustee the power to invade principal or accumulate+income, or prohibit the trustee from invading principal or+accumulating income, and the extent to which the trustee has+exercised a power from time to time to invade principal or+accumulate income;+ (8) The actual and anticipated effect of economic+conditions on principal and income and effects of inflation+and deflation; and+ (9) The anticipated tax consequences of an adjustment.+ 3.] 5. A [trustee may] fiduciary shall not exercise+the power under subsection 1 of this section to make an+adjustment or under section 469.435 to make a determination+that an allocation is insubstantial if:+ (1) [That diminishes the income interest in a trust+which requires all of the income to be paid at least+annually to a spouse and for which an estate tax or gift tax+marital deduction would be allowed, in whole or in part, if+the trustee did not have the power to make the adjustment;+ (2) That reduces the actuarial value of the income+interest in a trust to which a person transfers property+with the intent to qualify for a gift tax exclusion;+ (3) That changes] The adjustment or determination+would reduce the amount payable to a current income+beneficiary from a trust that qualifies for a special tax+benefit, except to the extent the adjustment is made to+provide for a reasonable apportionment of the total return+of the trust between the current income beneficiary and+successor beneficiaries;+ (2) The adjustment or determination would change the+amount payable to a beneficiary, as a fixed annuity or a+fixed fraction of the value of the trust assets, under the+terms of the trust;++ 49+ [(4) From any] (3) The adjustment or determination+would reduce an amount that is permanently set aside for a+charitable [purposes] purpose under [a will or] the terms of+[a] the trust [to the extent that the existence of the power+to adjust would change the character of the amount], unless+both income and principal are set aside for [federal income,+gift or estate tax purposes] the charitable purpose;+ [(5) If ] (4) Possessing or exercising the power [to+make an adjustment causes an individual] would cause a+person to be treated as the owner of all or part of the+trust for federal income tax purposes[, and the individual+would not be treated as the owner if the trustee did not+possess the power to make an adjustment];+ [(6) If ] (5) Possessing or exercising the power [to+make an adjustment causes] would cause all or part of the+value of the trust assets to be included [for estate tax+purposes] in the gross estate of an individual [who has] for+federal estate tax purposes;+ (6) Possessing or exercising the power [to remove or+appoint a trustee, or both,] would cause an individual to be+treated as making a gift for federal gift tax purposes;+ (7) The fiduciary is not an independent person;+ (8) The trust is irrevocable and [the assets would not+be included in the estate of the individual if the trustee+did not possess] provides for income to be paid to the+settlor and possessing or exercising the power [to make an+adjustment] would cause the adjusted principal or income to+be considered an available resource or available income+under a public-benefit program; or+ [(7) If the trustee is a beneficiary of the trust; or+ (8) If the trustee is not a beneficiary, but the+adjustment would benefit the trustee directly or indirectly]++ 50+ (9) The trust is a unitrust under sections 469.471 to+469.487.+ [4.] 6. If [subdivision (5), (6), (7) or (8) of]+subsection [3] 5 of this section applies to a [trustee and+there is more than one trustee, a cotrustee to whom the+provision does] fiduciary:+ (1) A cofiduciary to which subdivisions (4) to (7) of+subsection 5 of this section do not apply may [make]+exercise the [adjustment] power to adjust unless the+exercise of the power by the remaining [trustee or trustees]+cofiduciary or cofiduciaries is not permitted by the terms+of the trust or law other than sections 469.399 to 469.487;+and+ (2) If there is no cofiduciary to which subdivisions+(4) to (7) of subsection 5 of this section do not apply, the+fiduciary may appoint a cofiduciary to which subdivisions+(4) to (7) of subsection 5 of this section do not apply,+which may be a special fiduciary with limited powers, and+the appointed cofiduciary may exercise the power to adjust+under subsection 1 of this section, unless the appointment+of a cofiduciary or the exercise of the power by a+cofiduciary is not permitted by the terms of the trust or+law other than under sections 469.399 to 469.487.+ [5.] 7. A [trustee] fiduciary may release [the entire+power conferred by subsection 1 of this section, or may+release only] or delegate to a cofiduciary the power to+adjust [from income to principal or the power to adjust from+principal to income if the trustee is uncertain about+whether possessing or exercising] under subsection 1 of this+section if the fiduciary determines that the fiduciary's+possession or exercise of the power will or may:+ (1) Cause a result described in subdivisions (1) to+(6) or subdivision (8) of subsection [3] 5 of this section++ 51+[,]; or [if the trustee determines that possessing or+exercising the power will or may]+ (2) Deprive the trust of a tax benefit or impose a tax+burden not described in subdivisions (1) to (6) of+subsection [3] 5 of this section. [The release may be+permanent or for]+ 8. A fiduciary's release or delegation to a+cofiduciary under subsection 7 of this section of the power+to adjust under subsection 1 of this section:+ (1) Shall be in a record;+ (2) Applies to the entire power, unless the release or+delegation provides a limitation, which may be a limitation+to the power to adjust:+ (a) From income to principal;+ (b) From principal to income;+ (c) For specified property; or+ (d) In specified circumstances;+ (3) For a delegation, may be modified by a+redelegation under this subsection by the cofiduciary to+which the delegation is made; and+ (4) Subject to subdivision (3) of this subsection, is+permanent unless the release or delegation provides a+specified period, including a period measured by the life of+an individual or the lives of more than one individual.+ [6.] 9. Terms of a trust that deny or limit the power+[of a trustee] to [make an adjustment] adjust between income+and principal [and income] do not affect the application of+this section unless [it is clear from] the terms of the+trust [that the terms are intended to] expressly deny [the+trustee] or limit the power [of adjustment conferred by] to+adjust under subsection 1 of this section.+ 10. The exercise of the power to adjust under+subsection 1 of this section in any accounting period may++ 52+apply to the current period, the immediately preceding+period, and one or more subsequent periods.+ 11. A description of the exercise of the power to+adjust under subsection 1 of this section shall be:+ (1) Included in a report, if any, sent to+beneficiaries under subsection 3 of section 456.8-813; or+ (2) Communicated at least annually to the qualified+beneficiaries defined in section 456.1-103 other than all+beneficiaries that receive or are entitled to receive income+from the trust or would be entitled to receive a+distribution of principal if the trust were terminated at+the time the notice is sent, assuming no power of+appointment is exercised.+ 469.413. [After a decedent dies, in the case] 1. This+section applies when:+ (1) The death of an individual results in the creation+of an estate[, or after] or trust; or+ (2) An income interest in a trust [ends, the following+rules apply:] terminates, whether the trust continues or is+distributed.+ [(1)] 2. A fiduciary of an estate or [of a+terminating] trust with an income interest that terminates+shall determine, under subsection 7 of this section and+sections 469.417 to 469.462, the amount of net income and+net principal receipts received from property specifically+given to a beneficiary [pursuant to the rules in sections+469.417 to 469.461 which apply to trustees and the rules in+subdivision (5) of this section]. The fiduciary shall+distribute the net income and net principal receipts to the+beneficiary [who] that is to receive the specific+property[;].+ [(2)] 3. A fiduciary shall determine the [remaining]+income and net income of [a decedent's] an estate or [a++ 53+terminating] income interest [pursuant to the rules in] in a+trust that terminates, other than the amount of net income+determined under subsection 2 of this section, under+sections 469.417 to [469.461 which apply to trustees]+469.462 and by:+ [(a)] (1) Including in net income all income from+property used or sold to discharge liabilities;+ [(b)] (2) Paying from income or principal, in the+fiduciary's discretion, fees of attorneys, accountants, and+fiduciaries[;], court costs and other expenses of+administration[;], and interest on [death] estate and+inheritance taxes and other taxes imposed because of the+decedent's death, but the fiduciary may pay [those] the+expenses from income of property passing to a trust for+which the fiduciary claims [an] a federal estate tax marital+or charitable deduction only to the extent [that]:+ (a) The payment of [those] the expenses from income+will not cause the reduction or loss of the deduction; [and]+or+ (b) The fiduciary makes an adjustment under subsection+2 of section 469.462; and+ [(c)] (3) Paying from principal [all] other+disbursements made or incurred in connection with the+settlement of [a decedent's] the estate or the winding up of+[a terminating] an income interest that terminates,+including:+ (a) To the extent authorized by the decedent's will,+the terms of the trust, or applicable law, debts, funeral+expenses, disposition of remains, family allowances, estate+and [death] inheritance taxes, and other taxes imposed+because of the decedent's death; and+ (b) Related penalties that are apportioned, by the+decedent's will, the terms of the trust, or applicable law,++ 54+to the estate or [terminating] income interest [by the will,+the terms of the trust, or applicable law;+ (3) A fiduciary shall distribute to a beneficiary who+receives a pecuniary amount outright the interest or any+other amount provided by the will, the terms of the trust,+or in the absence of any such provisions, the provisions of+section 473.633, from net income determined pursuant to+subdivision (2) of this section or from principal to the+extent that net income is insufficient] that terminates.+ 4. If a decedent's will, the terms of a trust, or+applicable law provides for the payment of interest or the+equivalent of interest to a beneficiary that receives a+pecuniary amount outright, the fiduciary shall make the+payment from net income determined under subsection 3 of+this section or from principal to the extent net income is+insufficient.+ 5. If a beneficiary is to receive a pecuniary amount+outright from a trust after an income interest ends because+of an income beneficiary's death, and no payment of interest+or [other amount] the equivalent of interest is provided for+by the terms of the trust or applicable law, the fiduciary+shall [distribute] pay the interest or [other amount] the+equivalent of interest to which the beneficiary would be+entitled under applicable law if the pecuniary amount were+required to be paid under a will[;].+ [(4)] 6. A fiduciary shall distribute [the] net income+remaining after [distributions] payments required by+[subdivision (3)] subsections 4 and 5 of this section in the+manner described in section 469.415 to all other+beneficiaries, including a beneficiary [who] that receives a+pecuniary amount in trust, even if the beneficiary holds an+unqualified power to withdraw assets from the trust or other++ 55+presently exercisable general power of appointment over the+trust[;].+ [(5)] 7. A fiduciary [may] shall not reduce principal+or income receipts from property described in [subdivision+(1)] subsection 2 of this section because of a payment+described in sections 469.451 and 469.453 to the extent+[that] the decedent's will, the terms of the trust, or+applicable law requires the fiduciary to make the payment+from assets other than the property or to the extent [that]+the fiduciary recovers or expects to recover the payment+from a third party. The net income and principal receipts+from the property [are] shall be determined by including+[all of] the amounts the fiduciary receives or pays [with+respect to] regarding the property, whether [those amounts]+the amount accrued or became due before, on, or after the+date of [a] the decedent's death or an income interest's+terminating event, and [by] making a reasonable provision+for [amounts that the fiduciary believes] an amount the+estate or [terminating] income interest may become obligated+to pay after the property is distributed.+ 469.415. 1. [Each] Except to the extent sections+469.471 to 469.487 apply for a beneficiary that is a trust,+each beneficiary described in [subdivision (4)] subsection 6+of section 469.413 is entitled to receive a [portion] share+of the net income equal to the beneficiary's fractional+interest in undistributed principal assets, using values as+of the distribution date. If a fiduciary makes more than+one distribution of assets to beneficiaries to [whom] which+this section applies, each beneficiary, including [one who]+a beneficiary that does not receive part of the+distribution, is entitled, as of each distribution date, to+a share of the net income the fiduciary [has] received after+the [date of] decedent's death [or], an income interest's++ 56+other terminating event, or [earlier] the preceding+distribution [date but has not distributed as of the current+distribution date] by the fiduciary.+ 2. In determining a beneficiary's share of net income+under subsection 1 of this section, the following rules+apply:+ (1) The beneficiary is entitled to receive a [portion]+share of the net income equal to the beneficiary's+fractional interest in the undistributed principal assets+immediately before the distribution date[, including assets+that later may be sold to meet principal obligations];+ (2) The beneficiary's fractional interest [in the+undistributed principal assets] under subdivision (1) of+this subsection shall be calculated [without regard to+property specifically given to a beneficiary and property+required to pay pecuniary amounts not in trust;+ (3) The beneficiary's fractional interest in the+undistributed principal assets shall be calculated]:+ (a) On the [basis of the] aggregate value of [those]+the assets as of the distribution date without reducing the+value by any unpaid principal obligation; and+ (b) Without regard to:+ a. Property specifically given to a beneficiary under+the decedent's will or the terms of the trust; and+ b. Property required to pay pecuniary amounts not in+trust; and+ [(4)] (3) The distribution date [for purposes of this+section] under subdivision (1) of this subsection may be the+date as of which the fiduciary calculates the value of the+assets if that date is reasonably near the date on which the+assets are [actually] distributed.+ 3. [If] To the extent a fiduciary does not distribute+under this section all [of] the collected but undistributed++ 57+net income to each [person] beneficiary as of a distribution+date, the fiduciary shall maintain [appropriate] records+showing the interest of each beneficiary in [that] the net+income.+ 4. If this section applies to income from an asset, a+fiduciary may apply the rules in this section[, to the+extent that the fiduciary considers it appropriate,] to net+gain or loss realized from the disposition of the asset+after the [date of] decedent's death [or], an income+interest's terminating event, or [earlier] the preceding+distribution [date from the disposition of a principal asset+if this section applies to the income from the asset] by the+fiduciary.+ 469.417. 1. An income beneficiary is entitled to net+income in accordance with the terms of the trust from the+date [on which the] an income interest begins. [An] The+income interest begins on the date specified in the terms of+the trust or, if no date is specified, on the date an asset+becomes subject to [a trust or successive income interest]:+ (1) The trust for the current income beneficiary; or+ (2) A successive interest for a successor beneficiary.+ 2. An asset becomes subject to a trust under+subdivision (1) of subsection 1 of this section:+ (1) [On the date it is transferred to the trust in the+case of] For an asset that is transferred to [a] the trust+during the [transferor's] settlor's life, on the date the+asset is transferred;+ (2) [On the date of a testator's death in the case of]+For an asset that becomes subject to [a] the trust [by+reason] because of a [will] decedent's death, on the date of+the decedent's death, even if there is an intervening period+of administration of the [testator's] decedent's estate; or++ 58+ (3) [On the date of an individual's death in the case+of] For an asset that is transferred to a fiduciary by a+third party because of [the individual's] a decedent's+death, on the date of the decedent's death.+ 3. An asset becomes subject to a successive [income]+interest under subdivision (2) of subsection 1 of this+section on the day after the preceding income interest ends,+as determined [pursuant to] under subsection 4 of this+section, even if there is an intervening period of+administration to wind up the preceding income interest.+ 4. An income interest ends on the day before an income+beneficiary dies or another terminating event occurs[,] or+on the last day of a period during which there is no+beneficiary to [whom] which a [trustee] fiduciary may or+shall distribute income.+ 469.419. 1. A [trustee] fiduciary shall allocate an+income receipt or disbursement, other than [one] a receipt+to which [subdivision (1)] subsection 2 of section 469.413+applies, to principal if its due date occurs before [a+decedent dies in the case of] the date on which:+ (1) For an estate, the decedent died; or [before]+ (2) For a trust or successive interest, an income+interest begins [in the case of a trust or successive income+interest].+ 2. [A trustee shall allocate an income receipt or+disbursement to income if its] If the due date of a periodic+income receipt or disbursement occurs on or after the date+on which a decedent [dies] died or an income interest+[begins and it is a periodic due date. An income] began, a+fiduciary shall allocate the receipt or disbursement to+income.+ 3. If an income receipt or disbursement is not+periodic or has no due date, a fiduciary shall [be treated]++ 59+treat the receipt or disbursement under this section as+accruing from day to day [if its due date is not periodic or+it has no due date]. The fiduciary shall allocate to+principal the portion of the receipt or disbursement+accruing before the date on which a decedent [dies] died or+an income interest [begins shall be allocated to principal]+began, and to income the balance [shall be allocated to+income].+ [3.] 4. A receipt or disbursement is periodic under+subsections 2 and 3 of this section if:+ (1) The receipt or disbursement shall be paid at+regular intervals under an obligation to make payments; or+ (2) The payer customarily makes payments at regular+intervals.+ 5. An item of income or [an] obligation is due under+this section on the date [a payment] the payer is required+to make a payment. If a payment date is not stated, there+is no due date [for the purposes of sections 469.401 to+469.467].+ 6. Distributions to shareholders or other owners from+an entity to which section 469.423 applies are [deemed to+be] due:+ (1) On the date fixed by or on behalf of the entity+for determining [who is] the persons entitled to receive the+distribution [or,];+ (2) If no date is fixed, on the [declaration] date+[for] of the decision by or on behalf of the entity to make+the distribution[. A due date is periodic for receipts or+disbursements that shall be paid at regular intervals under+a lease or an obligation to pay interest or if an entity+customarily makes distributions at regular intervals]; or+ (3) If no date is fixed and the fiduciary does not+know the date of the decision by or on behalf of the entity++ 60+to make the distribution, on the date the fiduciary learns+of the decision.+ 469.421. 1. [For purposes of] As used in this+section, the [phrase] term "undistributed income" means net+income received on or before the date on which an income+interest ends. The [phrase] term "undistributed income"+does not include an item of income or expense that is due or+accrued[,] or net income that has been added or is required+to be added to principal under the terms of the trust.+ 2. Except as otherwise provided in subsection 3 of+this section, when a mandatory income interest of a+beneficiary ends, the [trustee] fiduciary shall pay [to a+mandatory income beneficiary who survives that date, or the+estate of a deceased mandatory income beneficiary whose+death causes the interest to end,] the beneficiary's share+of the undistributed income that is not disposed of under+the terms of the trust [unless] to the beneficiary or, if+the beneficiary does not survive the date the interest ends,+to the beneficiary's estate.+ 3. If a beneficiary has an unqualified power to+[revoke] withdraw more than five percent of the value of a+trust immediately before [the] an income interest ends[. In+the latter case,]:+ (1) The fiduciary shall allocate to principal the+undistributed income from the portion of the trust that may+be [revoked shall be added to principal] withdrawn; and+ (2) Subsection 2 of this section applies only to the+balance of the undistributed income.+ [3.] 4. When a [trustee's] fiduciary's obligation to+pay a fixed annuity or a fixed fraction of the value of [the+trust's] assets ends, the [trustee] fiduciary shall prorate+the final payment [if and to the extent] as required [by+applicable law to accomplish a purpose of the trust or its++ 61+settlor relating] to preserve an income tax, gift tax,+estate tax, or other tax [requirements] benefit.+ 469.423. 1. [For purposes of] As used in this+section, the [term] following terms mean:+ (1) "Capital distribution", an entity distribution of+money that is a:+ (a) Return of capital; or+ (b) Distribution in total or partial liquidation of+the entity;+ (2) "Entity" [means]:+ (a) A corporation, partnership, limited liability+company, regulated investment company, real estate+investment trust, common trust fund, or any other+organization [in which a trustee has an interest, other than+a trust or estate to which section 469.425 applies, a+business or activity to which section 469.427 applies, or an+asset-backed security to which section 469.449 applies] or+arrangement in which a fiduciary owns or holds an interest,+whether or not the entity is a taxpayer for federal income+tax purposes; and+ (b) The term "entity" does not include:+ a. A trust or estate to which section 469.425 applies;+ b. A business or other activity to which section+469.427 applies that is not conducted by an entity described+in paragraph (a) of this subdivision;+ c. An asset-backed security; or+ d. An instrument or arrangement to which section+469.446 applies;+ (3) "Entity distribution", a payment or transfer by an+entity made to a person in the person's capacity as an owner+or holder of an interest in the entity.+ 2. In this section, an attribute or action of an+entity includes an attribute or action of any other entity++ 62+in which the entity owns or holds an interest, including an+interest owned or held indirectly through another entity.+ [2.] 3. Except as otherwise provided in subdivisions+(2) to (4) of subsection 4 of this section, a [trustee]+fiduciary shall allocate to income:+ (1) Money received [from] in an entity[.+ 3. A trustee shall allocate the following receipts+from an entity to principal:+ (1) Property other than money;+ (2) Money received in one distribution or a series of+related distributions in exchange for part or all of a+trust's interest in the entity;+ (3) Money received in total or partial liquidation of+the entity; and+ (4) Money received from an entity that is]+distribution; and+ (2) Tangible personal property of nominal value+received from the entity.+ 4. A fiduciary shall allocate to principal:+ (1) Property received in an entity distribution that+is not:+ (a) Money; or+ (b) Tangible personal property of nominal value;+ (2) Money received in an entity distribution in an+exchange for part or all of the fiduciary's interest in the+entity, to the extent the entity distribution reduces the+fiduciary's interest in the entity relative to the interests+of other persons that own or hold interests in the entity;+ (3) Money received in an entity distribution that the+fiduciary determines or estimates is a capital distribution;+and+ (4) Money received in an entity distribution from an+entity that is:++ 63+ (a) A regulated investment company or [a] real estate+investment trust if the money [distributed] received is a+capital gain dividend for federal income tax purposes[.+ 4. Money is received in partial liquidation:+ (1) To the extent that the entity, at or near the time+of a distribution, indicates that such money is a+distribution in partial liquidation; or+ (2) If]; or+ (b) Treated for federal income tax purposes comparably+to the treatment described in paragraph (a) of this+subdivision.+ 5. A fiduciary may determine or estimate that money+received in an entity distribution is a capital distribution:+ (1) By relying, without inquiry or investigation, on a+characterization of the entity distribution provided by or+on behalf of the entity, unless the fiduciary:+ (a) Determines, on the basis of information known to+the fiduciary, that the characterization is or may be+incorrect; or+ (b) Owns or holds more than fifty percent of the+voting interest in the entity;+ (2) By determining or estimating, on the basis of+information known to the fiduciary or provided to the+fiduciary by or on behalf of the entity, that the total+amount of money and property received by the fiduciary in+[a] the entity distribution or a series of related entity+distributions is or will be greater than twenty percent of+the [entity's gross assets, as shown by the entity's year-+end financial statements immediately preceding the initial+receipt.+ 5. Money is not received in partial liquidation, nor+may it be taken into account pursuant to subdivision (2) of+subsection 4 of this section, to the extent that such money++ 64+does not exceed the amount of income tax that a trustee or+beneficiary shall pay on taxable income of the entity that+distributes the money.+ 6. A trustee may rely upon a statement made by an+entity about the source or character of a distribution if+the statement is made at or near the time of distribution by+the entity's board of directors or other person or group of+persons authorized to exercise powers to pay money or+transfer property comparable to those of a corporation's+board of directors] fair market value of the fiduciary's+interest in the entity; or+ (3) If neither subdivision (1) nor (2) of this+subsection applies, by considering the factors in subsection+6 of this section and the information known to the fiduciary+or provided to the fiduciary by or on behalf of the entity.+ 6. In making a determination or estimate under+subdivision (3) of subsection 5 of this section, a fiduciary+may consider:+ (1) A characterization of an entity distribution+provided by or on behalf of the entity;+ (2) The amount of money or property received in:+ (a) The entity distribution; or+ (b) What the fiduciary determines is or will be a+series of related entity distributions;+ (3) The amount described in subdivision (2) of this+subsection compared to the amount the fiduciary determines+or estimates is, during the current or preceding accounting+periods:+ (a) The entity's operating income;+ (b) The proceeds of the entity's sale or other+disposition of:+ a. All or part of the business or other activity+conducted by the entity;++ 65+ b. One or more business assets that are not sold to+customers in the ordinary course of the business or other+activity conducted by the entity; or+ c. One or more assets other than business assets,+unless the entity's primary activity is to invest in assets+to realize gain on the disposition of all or some of the+assets;+ (c) If the entity's primary activity is to invest in+assets to realize gain on the disposition of all or some of+the assets, the gain realized on the disposition;+ (d) The entity's regular, periodic entity+distributions;+ (e) The amount of money the entity has accumulated;+ (f) The amount of money the entity has borrowed;+ (g) The amount of money the entity has received from+the sources described in sections 469.433, 469.439, 469.441,+and 469.443; and+ (h) The amount of money the entity has received from a+source not otherwise described in this subdivision; and+ (4) Any other factor the fiduciary determines is+relevant.+ 7. If, after applying subsections 3 to 6 of this+section, a fiduciary determines that a part of an entity+distribution is a capital distribution but is in doubt about+the amount of the entity distribution that is a capital+distribution, the fiduciary shall allocate to principal the+amount of the entity distribution that is in doubt.+ 8. If a fiduciary receives additional information+about the application of this section to an entity+distribution before the fiduciary has paid part of the+entity distribution to a beneficiary, the fiduciary may+consider the additional information before making the++ 66+payment to the beneficiary and may change a decision to make+the payment to the beneficiary.+ 9. If a fiduciary receives additional information+about the application of this section to an entity+distribution after the fiduciary has paid part of the entity+distribution to a beneficiary, the fiduciary is not required+to change or recover the payment to the beneficiary but may+consider that information in determining whether to exercise+the power to adjust under section 469.405.+ 469.425. A [trustee] fiduciary shall allocate to+income an amount received as a distribution of income,+including a unitrust distribution under sections 469.471 to+469.487, from a trust or [an] estate in which the [trust]+fiduciary has an interest, other than [a] an interest the+fiduciary purchased [interest] in a trust that is an+investment entity, and shall allocate to principal an amount+received as a distribution of principal from [such a] the+trust or estate. If a [trustee] fiduciary purchases, or+receives from a settlor, an interest in a trust that is an+investment entity, [or a decedent or donor transfers an+interest in such a trust to a trustee,] section 469.423,+469.446, or 469.449 [shall apply] applies to a receipt from+the trust.+ 469.427. 1. [If a trustee who conducts] This section+applies to a business or other activity conducted by a+fiduciary if the fiduciary determines that it is in the+[best interest] interests of [all] the beneficiaries to+account separately for the business or other activity+instead of:+ (1) Accounting for [it] the business or other activity+as part of the [trust's] fiduciary's general accounting+records[,]; or++ 67+ (2) Conducting the [trustee] business or other+activity through an entity described in paragraph (a) of+subdivision (2) of subsection 1 of section 469.423.+ 2. A fiduciary may [maintain separate accounting+records] account separately under this section for [its] the+transactions of a business or other activity, whether or not+[its] assets of the business or other activity are+segregated from other [trust] assets held by the fiduciary.+ [2.] 3. A [trustee who] fiduciary that accounts+separately under this section for a business or other+activity:+ (1) May determine:+ (a) The extent to which the net cash receipts of the+business or other activity shall be retained for:+ a. Working capital[,];+ b. The acquisition or replacement of fixed assets[,];+and+ c. Other reasonably foreseeable needs of the business+or other activity[,]; and+ (b) The extent to which the remaining net cash+receipts are accounted for as principal or income in the+[trust's] fiduciary's general accounting records[. If a+trustee sells assets of the business or other activity,+other than in the ordinary course of the business or+activity, the trustee] for the trust;+ (2) May make a determination under subdivision (1) of+this subsection separately and differently from the+fiduciary's decisions concerning distributions of income or+principal; and+ (3) Shall account for the net amount received from the+sale of an asset of the business or other activity, other+than a sale in the ordinary course of the business or other+activity, as principal in the [trust's] fiduciary's general++ 68+accounting records for the trust, to the extent the+[trustee] fiduciary determines that the net amount received+is no longer required in the conduct of the business or+other activity.+ [3.] 4. Activities for which a [trustee may maintain+separate accounting records] fiduciary may account+separately under this section include:+ (1) Retail, manufacturing, service, and other+traditional business activities;+ (2) Farming;+ (3) Raising and selling livestock and other animals;+ (4) [Management of] Managing rental properties;+ (5) [Extraction of] Extracting minerals, water, and+other natural resources;+ (6) Growing and cutting timber [operations]; [and]+ (7) [Activities] An activity to which section 469.446,+469.447, or 469.449 applies; and+ (8) Any other business conducted by the fiduciary.+ 469.429. A [trustee] fiduciary shall allocate to+principal:+ (1) To the extent not allocated to income [pursuant+to] under sections [469.401] 469.399 to [469.467] 469.487,+[assets] an asset received from [a transferor]:+ (a) An individual during the [transferor's]+individual's lifetime[, a decedent's];+ (b) An estate[,];+ (c) A trust [with a terminating] on termination of an+income interest[,]; or+ (d) A payer under a contract naming the [trust or its+trustee] fiduciary as beneficiary;+ (2) Except as otherwise provided in sections 469.423+to 469.449, money or other property received from the sale,+exchange, liquidation, or change in form of a principal++ 69+asset[, including realized profit, subject to sections+469.423 to 469.467];+ (3) [Amounts] An amount recovered from a third+[parties] party to reimburse the [trust] fiduciary because+of [disbursements] a disbursement described in [subdivision+(7) of] subsection 1 of section 469.453 or for [other+reasons] another reason to the extent not based on [the]+loss of income;+ (4) Proceeds of property taken by eminent domain, [but+a separate award made] except that proceeds awarded for+[the] loss of income [with respect to] in an accounting+period [during which] are income if a current income+beneficiary had a mandatory income interest [is income]+during the period;+ (5) Net income received in an accounting period during+which there is no beneficiary to [whom] which a [trustee]+fiduciary may or shall distribute income; and+ (6) Other receipts as provided in sections 469.435 to+469.449.+ 469.431. To the extent [that a trustee accounts] a+fiduciary does not account for [receipts from] the+management of rental property [pursuant to this section] as+a business under section 469.427, the [trustee] fiduciary+shall allocate to income an amount received as rent of real+or personal property, including an amount received for+cancellation or renewal of a lease. An amount received as a+refundable deposit, including a security deposit or a+deposit that is to be applied as rent for future periods[,]:+ (1) Shall be added to principal and held subject to+the terms of the lease, except as otherwise provided by law+other than sections 469.399 to 469.487; and+ (2) Is not allocated to income or available for+distribution to a beneficiary until the [trustee's]++ 70+fiduciary's contractual obligations have been satisfied with+respect to that amount.+ 469.432. 1. This section does not apply to an+obligation to which section 469.437, 469.439, 469.441,+469.443, 469.446, 469.447, or 469.449 applies.+ 2. A fiduciary shall allocate to income, without+provision for amortization of premium, an amount received as+interest[, whether determined at a fixed, variable or+floating rate,] on an obligation to pay money to the+[trustee] fiduciary, including an amount received as+consideration for prepaying principal[, shall be allocated+to income without any provision for amortization of premium].+ [2.] 3. A [trustee] fiduciary shall allocate to+principal an amount received from the sale, redemption, or+other disposition of an obligation to pay money to the+[trustee more than one year after it is purchased or+acquired by the trustee, including an obligation whose+purchase price or value when it is acquired is less than its+value at maturity. If the obligation matures within one+year after it is purchased or acquired by the trustee, an+amount received in excess of its purchase price or its value+when acquired by the trust shall be allocated to income.+ 3. This section does not apply to an obligation to+which section 469.437, 469.439, 469.441, 469.443, 469.447 or+469.449 applies] fiduciary. A fiduciary shall allocate to+income the increment in value of a bond or other obligation+for the payment of money bearing no stated interest but+payable or redeemable, at maturity or another future time,+in an amount that exceeds the amount in consideration of+which it was issued.+ 469.433. 1. This section does not apply to a contract+to which section 469.437 applies.++ 71+ 2. Except as otherwise provided in subsection [2] 3 of+this section, a [trustee] fiduciary shall allocate to+principal the proceeds of a life insurance policy or other+contract [in which the trust or its trustee is named]+received by the fiduciary as beneficiary, including a+contract that insures [the trust or its trustee] against+[loss for] damage to, destruction of, or loss of title to [a+trust] an asset. The [trustee] fiduciary shall allocate+dividends on an insurance policy to income [if] to the+extent premiums on the policy are paid from income[,] and to+principal [if] to the extent premiums on the policy are paid+from principal.+ [2.] 3. A [trustee] fiduciary shall allocate to income+proceeds of a contract that insures the [trustee] fiduciary+against loss of:+ (1) Occupancy or other use by [an] a current income+beneficiary[, loss of];+ (2) Income[,]; or[,]+ (3) Subject to section 469.427, [loss of] profits from+a business.+ [3. This section does not apply to a contract to which+section 469.437 applies.]+ 469.435. 1. If a [trustee] fiduciary determines that+an allocation between income and principal [and income]+required by section 469.437, 469.439, 469.441, 469.443 or+469.449 is insubstantial, the [trustee] fiduciary may+allocate the entire amount to principal, unless [one of the+circumstances described in] subsection [3] 5 of section+469.405 applies to the allocation. [This power]+ 2. A fiduciary may [be exercised by a cotrustee in the+circumstances described in subsection 4 of section 469.405+and may be released for the reasons and in the manner+described in subsection 5 of section 469.405.] presume an++ 72+allocation is [presumed to be] insubstantial under+subsection 1 of this section if:+ (1) The amount of the allocation would increase or+decrease net income in an accounting period, as determined+before the allocation, by less than ten percent; [or] and+ (2) [The value of] The asset producing the receipt+[for which the allocation would] to be [made is] allocated+has a fair market value less than ten percent of the total+fair market value of the [trust's] assets owned or held by+the fiduciary at the beginning of the accounting period.+ 3. The power to make a determination under subsection+1 of this section may be:+ (1) Exercised by a cofiduciary in the manner described+in subsection 6 of section 469.405; or+ (2) Released or delegated for a reason described in+subsection 7 of section 469.405 and in the manner described+in subsection 8 of section 469.405.+ 469.437. 1. As used in this section, the following+terms mean:+ (1) "Internal income of a separate fund", the amount+determined under subsection 2 of this section;+ (2) "Marital trust", a trust:+ (a) Of which the settlor's surviving spouse is the+only current income beneficiary and is entitled to a+distribution of all the current net income of the trust; and+ (b) That qualifies for a marital deduction with+respect to the settlor's estate under 26 U.S.C. Section+2056, as amended, because:+ a. An election to qualify for a marital deduction+under 26 U.S.C. Section 2056(b)(7), as amended, has been+made; or+ b. The trust qualifies for a marital deduction under+26 U.S.C. Section 2056(b)(5), as amended;++ 73+ (3) "Payment", an amount [that is:+ (a) Received or withdrawn from a plan; or+ (b) One of a series of distributions that have been or+will be received] a fiduciary may receive over a fixed+number of years or during the life of one or more+individuals [under any contractual or other arrangement, or+is a single payment from a plan that the trustee could have+received over a fixed number of years or during the life of+one or more individuals] because of services rendered or+property transferred to the payer in exchange for future+amounts the fiduciary may receive. The term "payment"+includes an amount received in money or property from the+payer's general assets or from a separate fund created by+the payer;+ [(2) "Plan", a contractual, custodial, trust or other+arrangement that provides for distributions to the trust,+including, but not limited to, qualified retirement plans,+Individual Retirement Accounts, Roth Individual Retirement+Accounts, public and private annuities, and deferred+compensation, including payments received directly from an+entity as defined in section 469.423 regardless of whether+or not such distributions are made from a specific fund or+account.+ 2. If any portion of a payment is characterized as a+distribution to the trustee of interest, dividends or a+dividend equivalent, the trustee shall allocate the portion+so characterized to income. The trustee shall allocate the+balance of that payment to principal.+ 3. If no part of a payment is allocated to income+pursuant to subsection 2 of this section, then for each+accounting period of the trust that any payment is received+by the trust with respect to the trust's interest in a plan,+the trustee shall allocate to income that portion of the++ 74+aggregate value of all payments received by the trustee in+that accounting period equal to the amount of plan income+attributable to the trust's interest in the plan for that+calendar year. The trustee shall allocate the balance of+that payment to principal.+ 4. For purposes of this section, if a payment is+received from a plan that maintains a separate account or+fund for its participants or account holders, including, but+not limited to, defined contribution retirement plans,+Individual Retirement Accounts, Roth Individual Retirement+Accounts, and some types of deferred compensation plans, the+phrase "plan income" shall mean either the amount of the+plan account or fund held for the benefit of the trust that,+if the plan account or fund were a trust, would be allocated+to income pursuant to sections 469.401 to 469.467 for that+accounting period, or four percent of the value of the plan+account or fund on the first day of that accounting period.+The method of determining plan income pursuant to this+subsection shall be chosen by the trustee in the trustee's+discretion. The trustees may change the method of+determining plan income pursuant to this subsection for any+future accounting period.+ 5. For purposes of this section if the payment is+received from a plan that does not maintain a separate+account or fund for its participants or account holders,+including by way of example and not limitation defined+benefit retirement plans and some types of deferred+compensation plans, the term "plan income" shall mean four+percent of the total present value of the trust's interest+in the plan as of the first day of the accounting period,+based on reasonable actuarial assumptions as determined by+the trustee.++ 75+ 6. Notwithstanding subsections 1 to 5 of this section,+with respect to a trust where an election to qualify for a+marital deduction under Section 2056(b)(7) or Section+2523(f) of the Internal Revenue Code of 1986, as amended,+has been made, or a trust that qualified for the marital+deduction under either Section 2056(b)(5) or Section 2523(e)+of the Internal Revenue Code of 1986, as amended, a trustee+shall determine the plan income for the accounting period as+if the plan were a trust subject to sections 469.401 to+469.467. Upon request of the surviving spouse, the trustee+shall demand that the person administering the plan+distribute the plan income to the trust. The trustee shall+allocate a payment from the plan to income to the extent of+the plan income and distribute that amount to the surviving+spouse. The trustee shall allocate the balance of the+payment to principal. Upon request of the surviving spouse,+the trustee shall allocate principal to income to the extent+the plan income exceeds payments made from the plan to the+trust during the accounting period.+ 7. If, to obtain an estate or gift tax marital+deduction for a trust, a trustee shall allocate more of a+payment to income than provided for by this section, the+trustee shall allocate to income the additional amount+necessary to obtain the marital deduction.]+ (4) "Separate fund", includes a private or commercial+annuity, an individual retirement account, and a pension,+profit-sharing, stock bonus, or stock ownership plan.+ 2. For each accounting period, the following rules+apply to a separate fund:+ (1) The fiduciary shall determine the internal income+of the separate fund as if the separate fund was a trust+subject to sections 469.399 to 469.487;++ 76+ (2) If the fiduciary cannot determine the internal+income of the separate fund under subdivision (1) of this+subsection, the internal income of the separate fund is+deemed to equal three percent of the value of the separate+fund, according to the most recent statement of value+preceding the beginning of the accounting period; and+ (3) If the fiduciary cannot determine the value of the+separate fund under subdivision (2) of this subsection, the+value of the separate fund is deemed to equal the present+value of the expected future payments, as determined under+26 U.S.C. Section 7520, as amended, for the month preceding+the beginning of the accounting period for which the+computation is made.+ 3. A fiduciary shall allocate a payment received from+a separate fund during an accounting period to income, to+the extent of the internal income of the separate fund+during the accounting period, and the balance to principal.+ 4. The fiduciary of a marital trust shall:+ (1) Withdraw from a separate fund the amount the+current income beneficiary of the trust requests the+fiduciary to withdraw, not greater than the amount by which+the internal income of the separate fund during the+accounting period exceeds the amount the fiduciary otherwise+receives from the separate fund during the accounting period;+ (2) Transfer from principal to income the amount the+current income beneficiary requests the fiduciary to+transfer, not greater than the amount by which the internal+income of the separate fund during the accounting period+exceeds the amount the fiduciary receives from the separate+fund during the accounting period after the application of+subdivision (1) of this subsection; and+ (3) Distribute to the current income beneficiary as+income:++ 77+ (a) The amount of the internal income of the separate+fund received or withdrawn during the accounting period; and+ (b) The amount transferred from principal to income+under subdivision (2) of this subsection.+ 5. For a trust, other than a marital trust, of which+one or more current income beneficiaries are entitled to a+distribution of all the current net income, the fiduciary+shall transfer from principal to income the amount by which+the internal income of a separate fund during the accounting+period exceeds the amount the fiduciary receives from the+separate fund during the accounting period.+ 469.439. 1. As used in this section, the [phrase]+term "liquidating asset" means an asset whose value will+diminish or terminate because the asset is expected to+produce receipts for a [period of] limited [duration] time.+The [phrase] term "liquidating asset" includes a leasehold,+patent, copyright, royalty right, and right to receive+payments during a period of more than one year under an+arrangement that does not provide for the payment of+interest on the unpaid balance. [The phrase]+ 2. This section does not [include a payment] apply to+a receipt subject to section 469.423, 469.437, [resources+subject to section] 469.441, [timber subject to section]+469.443, [an activity subject to section] 469.446, 469.447,+[an asset subject to section] 469.449, or [any asset for+which the trustee establishes a reserve for depreciation+pursuant to section] 469.455.+ [2.] 3. A [trustee] fiduciary shall allocate:+ (1) To income [ten percent of the receipts from]:+ (a) A receipt produced by a liquidating asset [and the+balance], to the extent the receipt does not exceed three+percent of the value of the asset; or++ 78+ (b) If the fiduciary cannot determine the value of the+asset, ten percent of the receipt; and+ (2) To principal, the balance of the receipt.+ 469.441. 1. To the extent [that a trustee accounts+for receipts] a fiduciary does not account for a receipt+from an interest in minerals, water, or other natural+resources [pursuant to this section] as a business under+section 469.427, the [trustee] fiduciary shall allocate+[them as follows] the receipt:+ (1) [If] To income, to the extent received:+ (a) As [nominal] delay rental or [nominal] annual rent+on a lease[, a receipt shall be allocated to income];+ (b) As a factor for interest or the equivalent of+interest under an agreement creating a production payment; or+ (c) On account of an interest in renewable water;+ (2) To principal, if received from a production+payment, [a receipt shall be allocated to income if and to+the extent that the agreement creating the production+payment provides a factor for interest or its equivalent.+The balance shall be allocated to principal;] to the extent+paragraph (b) of subdivision (1) of this subsection does not+apply; or+ (3) [If an amount received] Between income and+principal equitably, to the extent received:+ (a) On account of an interest in nonrenewable water;+ (b) As a royalty, shut-in-well payment, take-or-pay+payment, or bonus [or delay rental is more than nominal,+ninety percent shall be allocated to principal and the+balance to income]; or+ [(4) If an amount is received] (c) From a working+interest or any other interest not provided for in+subdivision (1)[,] or (2) [or (3)] of this subsection[,+ninety percent of the net amount received shall be allocated++ 79+to principal and the balance to income] or paragraph (a) or+(b) of this subdivision.+ 2. [An amount received on account of] This section+applies to an interest [in water that is renewable shall be+allocated to income. If the water is not renewable, ninety+percent of the amount shall be allocated to principal and+the balance to income.+ 3. Sections 469.401 to 469.467 apply] owned or held by+a fiduciary whether or not a [decedent or donor] settlor was+extracting minerals, water, or other natural resources+before the fiduciary owned or held the interest [became+subject to the trust].+ 3. An allocation of a receipt under subdivision (3) of+subsection 1 of this section is presumed to be equitable if+the amount allocated to principal is equal to the amount+allowed by Title 26 of the United States Code, as amended,+as a deduction for depletion of the interest.+ 4. If a [trust] fiduciary owns or holds an interest in+minerals, water, or other natural resources [on] before+August 28, [2001] 2026, the [trustee] fiduciary may allocate+receipts from the interest as provided in [sections 469.401+to 469.467] this section or in the manner used by the+[trustee] fiduciary before August 28, [2001] 2026. If the+[trust] fiduciary acquires an interest in minerals, water,+or other natural resources on or after August 28, [2001]+2026, the [trustee] fiduciary shall allocate receipts from+the interest as provided in [sections 469.401 to 469.467]+this section.+ 469.443. 1. To the extent [that a trustee accounts] a+fiduciary does not account for receipts from the sale of+timber and related products [pursuant to this] as a business+under section 469.427, the [trustee] fiduciary shall+allocate the net receipts:++ 80+ (1) To income, to the extent [that] the amount of+timber [removed] cut from the land does not exceed the rate+of growth of the timber [during the accounting periods in+which a beneficiary has a mandatory income interest];+ (2) To principal, to the extent [that] the amount of+timber [removed] cut from the land exceeds the rate of+growth of the timber or the net receipts are from the sale+of standing timber;+ (3) [To or] Between income and principal if the net+receipts are from the lease of [timberland] land used for+growing and cutting timber or from a contract to cut timber+from land [owned by a trust], by determining the amount of+timber [removed] cut from the land under the lease or+contract and applying the rules in subdivisions (1) and (2)+of this subsection; or+ (4) To principal, to the extent [that] advance+payments, bonuses, and other payments are not allocated+[pursuant to either] under subdivision (1), (2), or (3) of+this subsection.+ 2. In determining net receipts to be allocated+[pursuant to] under subsection 1 of this section, a+[trustee] fiduciary shall deduct and transfer to principal a+reasonable amount for depletion.+ 3. [Sections 469.401 to 469.467 apply] This section+applies to land owned or held by a fiduciary whether or not+a [decedent or transferor] settlor was [harvesting] cutting+timber from the land before the fiduciary owned or held the+property [before it became subject to the trust].+ 4. If a [trust] fiduciary owns or holds an interest in+[timberland on] land used for growing and cutting timber+before August 28, [2001] 2026, the [trustee] fiduciary may+allocate net receipts from the sale of timber and related+products as provided in [sections 469.401 to 469.467] this++ 81+section or in the manner used by the [trustee] fiduciary+before August 28, [2001] 2026. If the [trust] fiduciary+acquires an interest in [timberland] land used for growing+and cutting timber on or after August 28, [2001] 2026, the+[trustee] fiduciary shall allocate net receipts from the+sale of timber and related products as provided in [sections+469.401 to 469.467] this section.+ 469.445. 1. If a trust received property for which a+gift or estate tax marital deduction [is] was allowed [for+all or part of a trust whose] and the settlor's spouse holds+a mandatory income interest in the trust, the spouse may+require the trustee, to the extent the trust assets [consist+substantially of property that does] otherwise do not+provide the spouse with sufficient income from or use of the+trust assets[, and if the amounts that the trustee transfers+from principal to income pursuant to section 469.405 and+distributes to the spouse from principal pursuant to the+terms of the trust are insufficient to provide the spouse+with the beneficial enjoyment required to obtain the+marital] to qualify for the deduction, [the spouse may+require the trustee] to:+ (1) Make property productive of income[,];+ (2) Convert property to property productive of income+within a reasonable time[,]; or+ (3) Exercise the power [conferred by subsection 1 of]+to adjust under section 469.405.+ 2. The trustee may decide which action or combination+of actions in subsection 1 of this section to take.+ [2. In cases not governed by subsection 1 of this+section, proceeds from the sale or other disposition of an+asset are principal without regard to the amount of income+the asset produces during any accounting period.]++ 82+ 469.446. A fiduciary shall allocate receipts from or+related to a financial instrument or arrangement not+otherwise addressed by sections 469.399 to 469.487. The+allocation shall be consistent with sections 469.447 and+469.449.+ 469.447. 1. As used in this section, the term+"derivative" means a contract [or financial], instrument,+other arrangement, or [a] combination of contracts [and+financial], instruments, or other arrangements, the value,+rights, and obligations of which [gives a trust the right or+obligation to participate in some or all changes in the+price of a] are, in whole or in part, dependent on or+derived from an underlying tangible or intangible asset+[or], group of tangible or intangible assets, [or changes in+a rate, an] index [of prices], or occurrence of an event.+The term "derivative" includes stocks, fixed income+securities, and financial instruments and arrangements based+on indices, commodities, interest rates, [or other market+indicator for an asset or a group of assets] weather-related+events, and credit default events.+ 2. To the extent [that a trustee] a fiduciary does not+account [pursuant to section 469.427 for transactions] for a+transaction in derivatives[, the trustee] as a business+under section 469.427, the fiduciary shall allocate [to+principal] ten percent of receipts from the transaction and+ten percent of disbursements made in connection with [those+transactions] the transaction to income and the balance to+principal.+ 3. The provisions of subsection 4 of this section+apply if:+ (1) A [trustee] fiduciary:++ 83+ (a) Grants an option to buy property from [the] a+trust, whether or not the trust owns the property when the+option is granted[,];+ (b) Grants an option that permits another person to+sell property to the trust[,]; or+ (c) Acquires an option to buy property for the trust+or an option to sell an asset owned by the trust[,]; and+ (2) The [trustee] fiduciary or other owner of the+asset is required to deliver the asset if the option is+exercised[,].+ 4. If this subsection applies, the fiduciary shall+allocate ten percent to income and the balance to principal+of the following amounts:+ (1) An amount received for granting the option [shall+be allocated to principal.];+ (2) An amount paid to acquire the option [shall be+paid from principal. A]; and+ (3) Gain or loss realized [upon] on the exercise [of+an option, including an option granted to a settlor],+exchange, settlement, offset, closing, or expiration of the+[trust for services rendered, shall be allocated to+principal] option.+ 469.449. 1. [As used in this section, the phrase+"asset-backed security" means an asset whose value is based+upon the right it gives the owner to receive distributions+from the proceeds of financial assets that provide+collateral for the security. The phrase includes an asset+that gives the owner the right to receive from the+collateral financial assets only the interest or other+current return or only the proceeds other than interest or+current return. The phrase does not include an asset to+which section 469.423 or 469.437 applies.++ 84+ 2. If a trust receives a payment from interest or+other current return and from other proceeds of the+collateral financial assets, the trustee] Except as+otherwise provided in subsection 2 of this section, a+fiduciary shall allocate to income [the portion of the+payment which] a receipt from or related to an asset-backed+security, to the extent the payer identifies the payment as+being from interest or other current return, and [shall+allocate] to principal the balance of the [payment to+principal] receipt.+ [3.] 2. If a [trust] fiduciary receives one or more+payments in exchange for part or all of the [trust's entire]+fiduciary's interest in an asset-backed security [in one+accounting period, the trustee shall allocate the payments+to principal. If a payment is one of a series of payments+that will result in the], including a liquidation or+redemption of the [trust's] fiduciary's interest in the+security [over more than one accounting period], the+[trustee] fiduciary shall allocate to income ten percent of+receipts from the [payment to income] transaction and [the+balance] ten percent of disbursements made in connection+with the transaction, and to principal the balance of the+receipts and disbursements.+ 469.451. [A trustee shall make the following+disbursements from income to the extent that they are not+disbursements to which paragraph (b) or (c) of] Subject to+section 469.456, and except as otherwise provided in+subdivision (2) or (3) of subsection 3 of section 469.413+[applies], a fiduciary shall disburse from income:+ (1) One-half of:+ (a) The regular compensation of the [trustee]+fiduciary and [of] any person providing investment advisory++ 85+[or], custodial, or other services to the [trustee]+fiduciary, to the extent income is sufficient; and+ [(2) One-half of all expenses] (b) An expense for+[accountings] an accounting, judicial [proceedings] or+nonjudicial proceeding, or other [matters] matter that+[involve] involves both [the] income and [remainder]+successive interests, to the extent income is sufficient;+ [(3) All of the other] (2) The balance of the+disbursements described in subdivision (1) of this section,+to the extent a fiduciary that is an independent person+determines that making those disbursements from income would+be in the interests of the beneficiaries;+ (3) Another ordinary [expenses] expense incurred in+connection with [the] administration, management, or+preservation of [trust] property and [the] distribution of+income, including interest, an ordinary [repairs] repair,+regularly recurring [taxes] tax assessed against principal,+and [expenses] an expense of [a] an accounting, judicial or+nonjudicial proceeding, or other matter that [concerns]+involves primarily [the] an income interest, to the extent+income is sufficient; and+ (4) [Recurring premiums] A premium on insurance+covering [the] loss of a principal asset or [the loss of]+income from or use of the asset.+ 469.453. 1. [A trustee shall make the following+disbursements] Subject to section 469.457, and except as+otherwise provided in subdivision (2) of subsection 3 of+section 469.413, a fiduciary shall disburse from principal:+ (1) The [remaining one-half] balance of the+disbursements described in subdivisions (1) and [(2)] (3) of+section 469.451, after application of subdivision (2) of+section 469.451;++ 86+ (2) [All of] The [trustee's] fiduciary's compensation+calculated on principal as a fee for acceptance,+distribution, or termination[, and disbursements made to+prepare property for sale];+ (3) [Payments] A payment of an expense to prepare for+or execute a sale or other disposition of property;+ (4) A payment on the principal of a trust debt;+ [(4) Expenses of a] (5) A payment of an expense of an+accounting, judicial or nonjudicial proceeding, or other+matter that [concerns] involves primarily [an interest in]+principal, including a proceeding to construe the terms of+the trust or protect property;+ [(5) Premiums paid on a policy of] (6) A payment of a+premium for insurance, including title insurance, not+described in subdivision (4) of section 469.451 of which the+[trust] fiduciary is the owner and beneficiary;+ [(6)] (7) A payment of an estate[,] or inheritance+[and other transfer taxes] tax or other tax imposed because+of the death of a decedent, including penalties, apportioned+to the trust; and+ [(7) Extraordinary expenses incurred in connection+with the management and preservation of trust property;+ (8) Expenses for a capital improvement to a principal+asset, whether in the form of changes to an existing asset+or the construction of a new asset, including special+assessments; and+ (9) Disbursements] (8) A payment:+ (a) Related to environmental matters, including:+ a. Reclamation[,];+ b. Assessing environmental conditions[,];+ c. Remedying and removing environmental+contamination[,];++ 87+ d. Monitoring remedial activities and the release of+substances[,];+ e. Preventing future releases of substances[,];+ f. Collecting amounts from persons liable or+potentially liable for the costs of [those] activities[,]+described in subparagraphs a. to e. of this paragraph;+ g. Penalties imposed under environmental laws or+regulations [and];+ h. Other [payments made] actions to comply with+[those] environmental laws or regulations[,];+ i. Statutory or common law claims by third parties[,];+and+ j. Defending claims based on environmental matters; and+ (b) For a premium for insurance for matters described+in paragraph (a) of this subdivision.+ 2. If a principal asset is encumbered with an+obligation that requires income from [that] the asset to be+paid directly to [the] a creditor, the [trustee] fiduciary+shall transfer from principal to income an amount equal to+the income paid to the creditor in reduction of the+principal balance of the obligation.+ 469.455. 1. As used in this section, the term+"depreciation" means a reduction in value due to wear, tear,+decay, corrosion, or gradual obsolescence of a [fixed]+tangible asset having a useful life of more than one year.+ 2. A [trustee] fiduciary may transfer to principal a+reasonable amount of the net cash receipts from a principal+asset that is subject to depreciation, but [may] shall not+transfer any amount for depreciation:+ (1) Of [that portion] the part of real property used+or available for use by a beneficiary as a residence [or];+ (2) Of tangible personal property held or made+available for the personal use or enjoyment of a beneficiary;++ 88+ [(2) During the administration of a decedent's+estate;] or+ (3) [Pursuant to] Under this section [if the trustee+is accounting pursuant], to the extent the fiduciary+accounts:+ (a) Under section 469.439 for the asset; or+ (b) Under section 469.427 for the business or other+activity in which the asset is used.+ 3. An amount transferred to principal under this+section need not be separately held [as a separate fund].+ 469.456. 1. If a fiduciary makes or expects to make+an income disbursement described in subsection 2 of this+section, the fiduciary may transfer an appropriate amount+from principal to income in one or more accounting periods+to reimburse income.+ 2. To the extent the fiduciary has not been and does+not expect to be reimbursed by a third party, income+disbursements to which subsection 1 of this section applies+include:+ (1) An amount chargeable to principal but paid from+income because principal is illiquid;+ (2) A disbursement made to prepare property for sale,+including improvements and commissions; and+ (3) A disbursement described in subsection 1 of+section 469.453.+ 3. If an asset whose ownership gives rise to an income+disbursement becomes subject to a successive interest after+an income interest ends, the fiduciary may continue to make+transfers under subsection 1 of this section.+ 469.457. 1. If a [trustee] fiduciary makes or expects+to make a principal disbursement described in subsection 2+of this section, the [trustee] fiduciary may transfer an+appropriate amount from income to principal in one or more++ 89+accounting periods to reimburse principal or [to] provide a+reserve for future principal disbursements.+ 2. To the extent a fiduciary has not been and does not+expect to be reimbursed by a third party, principal+disbursements to which subsection 1 of this section applies+include [the following, but only to the extent that the+trustee has not been and does not expect to be reimbursed by+a third party]:+ (1) An amount chargeable to income but paid from+principal because [it] income is [unusually large, including+extraordinary repairs] not sufficient;+ (2) [Disbursements] The cost of an improvement to+principal, whether a change to an existing asset or the+construction of a new asset, including a special assessment;+ (3) A disbursement made to prepare property for+rental, including tenant allowances, leasehold improvements,+and [broker's] commissions;+ [(3)] (4) A periodic [payments] payment on an+obligation secured by a principal asset, to the extent+[that] the amount transferred from income to principal for+depreciation is less than the periodic [payments] payment;+and+ [(4) Disbursements] (5) A disbursement described in+[subdivision (7) of] subsection 1 of section 469.453.+ 3. If [the] an asset whose ownership gives rise to+[the disbursements] a principal disbursement becomes subject+to a successive [income] interest after an income interest+ends, [a trustee] the fiduciary may continue to [transfer+amounts from income to principal as provided in] make+transfers under subsection 1 of this section.+ 469.459. 1. A tax required to be paid by a [trustee]+fiduciary that is based on receipts allocated to income+shall be paid from income.++ 90+ 2. A tax required to be paid by a [trustee] fiduciary+that is based on receipts allocated to principal shall be+paid from principal, even if the tax is called an income tax+by the taxing authority.+ 3. Subject to subsection 4 of this section and+sections 469.456, 469.457, and 469.462, a tax required to be+paid by a [trustee] fiduciary on [the trust's] a share of an+entity's taxable income in an accounting period shall be+paid from:+ (1) [From] Income and principal proportionately to the+[extent that] allocation between income and principal of+receipts from the entity [are allocated to income] in the+accounting period; and+ (2) [From] Principal to the extent [that] the tax+exceeds the receipts from the entity [are allocated only to+principal] in the accounting period.+ 4. After applying subsections 1 to 3 of this section,+[the trustee] a fiduciary shall adjust income or principal+receipts, to the extent [that] the [trust's] taxes the+fiduciary pays are reduced because [the trust receives] of a+deduction for a payment made to a beneficiary.+ 469.462. 1. A fiduciary may make an adjustment+between income and principal to offset the shifting of+economic interests or tax benefits between current income+beneficiaries and successor beneficiaries that arises from:+ (1) An election or decision the fiduciary makes+regarding a tax matter, other than a decision to claim an+income tax deduction to which subsection 2 of this section+applies;+ (2) An income tax or other tax imposed on the+fiduciary or a beneficiary as a result of a transaction+involving the fiduciary or a distribution by the fiduciary;+or++ 91+ (3) Ownership by the fiduciary of an interest in an+entity, a part of whose taxable income, whether or not+distributed, is includable in the taxable income of the+fiduciary or a beneficiary.+ 2. If the amount of an estate tax marital or+charitable deduction is reduced because a fiduciary deducts+an amount paid from principal for income tax purposes+instead of deducting it for estate tax purposes and, as a+result, estate taxes paid from principal are increased and+income taxes paid by the fiduciary or a beneficiary are+decreased, the fiduciary shall charge each beneficiary that+benefits from the decrease in income tax to reimburse the+principal from which the increase in estate tax is paid.+The total reimbursement shall equal the increase in the+estate tax, to the extent the principal used to pay the+increase would have qualified for a marital or charitable+deduction but for the payment. The share of the+reimbursement for each fiduciary or beneficiary whose income+taxes are reduced shall be the same as its share of the+total decrease in income tax.+ 3. A fiduciary that charges a beneficiary under+subsection 2 of this section may offset the charge by+obtaining payment from the beneficiary, withholding an+amount from future distributions to the beneficiary, or+adopting another method or combination of methods.+ 469.463. In applying and construing sections [469.401]+469.399 to [469.467] 469.487, consideration shall be given+to the need to promote uniformity of the law with respect to+its subject matter among states that enact it.+ 469.464. The provisions of sections 469.399 to 469.487+modify, limit, or supersede the Electronic Signatures in+Global and National Commerce Act, 15 U.S.C. Section 7001, et+seq., but do not modify, limit, or supersede 15 U.S.C.++ 92+Section 7001(c) or authorize electronic delivery of any of+the notices described in 15 U.S.C. Section 7003(b).+ 469.465. If any provision of sections [469.401]+469.399 to [469.467] 469.487 or [the] its application [of+these sections] to any person or circumstance is held+invalid, the invalidity does not affect other provisions or+applications of sections [469.401] 469.399 to [469.467]+469.487 which can be given effect without the invalid+provision or application and to this end, the provisions of+sections 469.399 to 469.487 are severable.+ 469.467. The provisions of sections [469.401] 469.399+to [469.467] 469.487 apply to [every] a trust or+[decedent's] estate existing or created on or after August+28, [2001] 2026, except as otherwise expressly provided in+the [will or] terms of the trust or [in] sections [469.401]+469.399 to [469.467] 469.487.+ 469.471. As used in sections 469.471 to 469.487, the+following terms mean:+ (1) "Applicable value", the amount of the net fair+market value of a trust taken into account under section+469.483;+ (2) "Express unitrust", a trust for which, under the+terms of the trust without regard to sections 469.471 to+469.487, income or net income shall or may be calculated as+a unitrust amount;+ (3) "Income trust", a trust that is not a unitrust;+ (4) "Net fair market value of a trust", the fair+market value of the assets of the trust, less the+noncontingent liabilities of the trust;+ (5) "Unitrust", a trust for which net income is a+unitrust amount. The term "unitrust" includes an express+unitrust;++ 93+ (6) "Unitrust amount", an amount computed by+multiplying a determined value of a trust by a determined+percentage. For a unitrust administered under a unitrust+policy, the term "unitrust amount" means the applicable+value multiplied by the unitrust rate;+ (7) "Unitrust policy", a policy described in sections+469.479 to 469.487 and adopted under section 469.475;+ (8) "Unitrust rate", the rate used to compute the+unitrust amount for a unitrust administered under a unitrust+policy.+ 469.473. 1. Except as otherwise provided in+subsection 2 of this section, sections 469.471 to 469.487+apply to:+ (1) An income trust, unless the terms of the trust+expressly prohibit use of sections 469.471 to 469.487 by a+specific reference to these sections or an explicit+expression of intent that net income not be calculated as a+unitrust amount; and+ (2) An express unitrust, except to the extent the+terms of the trust explicitly:+ (a) Prohibit use of sections 469.471 to 469.487 by a+specific reference to such sections;+ (b) Prohibit conversion to an income trust; or+ (c) Limit changes to the method of calculating the+unitrust amount.+ 2. Sections 469.471 to 469.487 do not apply to a trust+described in 26 U.S.C. Section 170(f)(2)(B), 642(c)(5),+664(d), 2702(a)(3)(A)(ii) or (iii), or 2702(b), as amended.+ 3. An income trust to which sections 469.471 to+469.487 apply under subdivision (1) of subsection 1 of this+section may be converted to a unitrust under sections+469.471 to 469.487 regardless of the terms of the trust+concerning distributions. Conversion to a unitrust under++ 94+sections 469.471 to 469.487 does not affect other terms of+the trust concerning distributions of income or principal.+ 4. Sections 469.471 to 469.487 apply to an estate only+to the extent a trust is a beneficiary of the estate. To+the extent of the trust's interest in the estate, the estate+may be administered as a unitrust, the administration of the+estate as a unitrust may be discontinued, or the percentage+or method used to calculate the unitrust amount may be+changed, in the same manner as for a trust under sections+469.471 to 469.487.+ 5. Sections 469.471 to 469.487 do not create a duty to+take or consider action under sections 469.471 to 469.487 or+to inform a beneficiary about the applicability of sections+469.471 to 469.487.+ 6. A fiduciary that in good faith takes or fails to+take an action under sections 469.471 to 469.487 is not+liable to a person affected by the action or inaction.+ 469.475. 1. A fiduciary, without court approval, by+complying with subsections 2 and 6 of this section, may:+ (1) Convert an income trust to a unitrust if the+fiduciary adopts in a record a unitrust policy for the trust+providing:+ (a) That, in administering the trust, the net income+of the trust will be a unitrust amount rather than net+income determined without regard to sections 469.471 to+469.487; and+ (b) The percentage and method used to calculate the+unitrust amount;+ (2) Change the percentage or method used to calculate+a unitrust amount for a unitrust if the fiduciary adopts in+a record a unitrust policy or an amendment or replacement of+a unitrust policy providing changes in the percentage or+method used to calculate the unitrust amount; or++ 95+ (3) Convert a unitrust to an income trust if the+fiduciary adopts in a record a determination that, in+administering the trust, the net income of the trust will be+net income determined without regard to sections 469.471 to+469.487 rather than a unitrust amount.+ 2. A fiduciary may take an action under subsection 1+of this section if:+ (1) The fiduciary determines that the action will+assist the fiduciary to administer a trust impartially;+ (2) The fiduciary sends a notice in a record, in the+manner required by section 469.477, describing and proposing+to take the action;+ (3) The fiduciary sends a copy of the notice under+subdivision (2) of this subsection to each settlor of the+trust that is:+ (a) If an individual, living; or+ (b) If not an individual, in existence;+ (4) At least one member of each class of the qualified+beneficiaries described under section 456.1-103 receiving+the notice under subdivision (2) of this subsection is:+ (a) If an individual, legally competent;+ (b) If not an individual, in existence; or+ (c) Represented in the manner provided in subsection 2+of section 469.477; and+ (5) The fiduciary does not receive, by the date+specified in the notice under subdivision (5) of subsection+4 of section 469.477, an objection in a record to the action+proposed under subdivision (2) of this subsection from a+person to which the notice under subdivision (2) of this+subsection is sent.+ 3. If a fiduciary receives, not later than the date+stated in the notice under subdivision (5) of subsection 4+of section 469.477, an objection in a record described in++ 96+subdivision (4) of subsection 4 of section 469.477 to a+proposed action, the fiduciary or a beneficiary may request+the court to have the proposed action taken as proposed,+taken with modifications, or prevented. A person described+in subsection 1 of section 469.477 may oppose the proposed+action in the proceeding under this subsection, whether or+not the person:+ (1) Consented under subsection 3 of section 469.477; or+ (2) Objected under subdivision (4) of subsection 4 of+section 469.477.+ 4. If, after sending a notice under subdivision (2) of+subsection 2 of this section, a fiduciary decides not to+take the action proposed in the notice, the fiduciary shall+notify in a record each person described in subsection 1 of+section 469.477 of the decision not to take the action and+the reasons for the decision.+ 5. If a beneficiary requests in a record that a+fiduciary take an action described in subsection 1 of this+section and the fiduciary declines to act or does not act+within ninety days after receiving the request, the+beneficiary may request the court to direct the fiduciary to+take the action requested.+ 6. In deciding whether and how to take an action+authorized by subsection 1 of this section, or whether and+how to respond to a request by a beneficiary under+subsection 5 of this section, a fiduciary shall consider all+factors relevant to the trust and the beneficiaries,+including relevant factors in subsection 5 of section+469.403.+ 7. A fiduciary may release or delegate the power to+convert an income trust to a unitrust under subdivision (1)+of subsection 1 of this section, change the percentage or+method used to calculate a unitrust amount under subdivision++ 97+(2) of subsection 1 of this section, or convert a unitrust+to an income trust under subdivision (3) of subsection 1 of+this section, for a reason described in subsection 7 of+section 469.405 and in the manner described in subsection 8+of section 469.405.+ 469.477. 1. A notice required by subdivision (3) of+subsection 2 of section 469.475 shall be sent in a manner+authorized under section 456.1-109 to:+ (1) The qualified beneficiaries defined in section+456.1-103;+ (2) Each person acting as trust protector under+section 456.8-808; and+ (3) Each person that is granted a power over the trust+by the terms of the trust, to the extent the power is+exercisable when the person is not then serving as a trustee:+ (a) Including a:+ a. Power over the investment, management, or+distribution of trust property or other matters of trust+administration; and+ b. Power to appoint or remove a trustee or person+described in this paragraph; and+ (b) Excluding a:+ a. Power of appointment;+ b. Power of a beneficiary over the trust, to the+extent the exercise or nonexercise of the power affects the+beneficial interest of the beneficiary or another+beneficiary represented by the beneficiary under sections+456.3-301 to 456.3-305 with respect to the exercise or+nonexercise of the power; and+ c. Power over the trust if the terms of the trust+provide that the power is held in a nonfiduciary capacity+and the power shall be held in a nonfiduciary capacity to++ 98+achieve a tax objective under Title 26 of the United States+Code, as amended.+ 2. The representation provisions of sections 456.3-301+to 456.3-305 apply to notice under this section.+ 3. A person may consent in a record at any time to+action proposed under subdivision (2) of subsection 2 of+section 469.475. A notice required by subdivision (2) of+subsection 2 of section 469.475 need not be sent to a person+that consents under this subsection.+ 4. A notice required by subdivision (2) of subsection+2 of section 469.475 shall include:+ (1) The action proposed under subdivision (2) of+subsection 2 of section 469.475;+ (2) For a conversion of an income trust to a unitrust,+a copy of the unitrust policy adopted under subdivision (1)+of subsection 1 of section 469.475;+ (3) For a change in the percentage or method used to+calculate the unitrust amount, a copy of the unitrust policy+or amendment or replacement of the unitrust policy adopted+under subdivision (2) of subsection 1 of section 469.475;+ (4) A statement that the person to which the notice is+sent may object to the proposed action by stating in a+record the basis for the objection and sending or delivering+the record to the fiduciary;+ (5) The date by which an objection under subdivision+(4) of this subsection shall be received by the fiduciary,+which shall be at least thirty days after the date the+notice is sent;+ (6) The date on which the action is proposed to be+taken and the date on which the action is proposed to take+effect;+ (7) The name and contact information of the fiduciary;+and++ 99+ (8) The name and contact information of a person that+may be contacted for additional information.+ 469.479. 1. In administering a unitrust under+sections 469.471 to 469.487, a fiduciary shall follow a+unitrust policy adopted under subdivision (1) or (2) of+subsection 1 of section 469.475 or amended or replaced under+subdivision (2) of subsection 1 of section 469.475.+ 2. A unitrust policy shall provide:+ (1) The unitrust rate or the method for determining+the unitrust rate under section 469.481;+ (2) The method for determining the applicable value+under section 469.483; and+ (3) The rules described in sections 469.481 to 469.487+that apply in the administration of the unitrust, whether+the rules are:+ (a) Mandatory, as provided in subsection 1 of section+469.483 and subsection 1 of section 469.485; or+ (b) Optional, as provided in section 469.481,+subsection 2 of section 469.483, subsection 2 of section+469.485, and subsection 1 of section 469.487, to the extent+the fiduciary elects to adopt such rules.+ 469.481. 1. Except as otherwise provided in+subdivision (1) of subsection 2 of section 469.487, a+unitrust rate may be:+ (1) A fixed unitrust rate; or+ (2) A unitrust rate that is determined for each period+using:+ (a) A market index or other published data; or+ (b) A mathematical blend of market indices or other+published data over a stated number of preceding periods.+ 2. Except as otherwise provided in subdivision (1) of+subsection 2 of section 469.487, a unitrust policy may+provide:++ 100+ (1) A limit on how high the unitrust rate determined+under subdivision (2) of subsection 1 of this section may+rise;+ (2) A limit on how low the unitrust rate determined+under subdivision (2) of subsection 1 of this section may+fall;+ (3) A limit on how much the unitrust rate determined+under subdivision (2) of subsection 1 of this section may+increase over the unitrust rate for the preceding period or+a mathematical blend of unitrust rates over a stated number+of preceding periods;+ (4) A limit on how much the unitrust rate determined+under subdivision (2) of subsection 1 of this section may+decrease below the unitrust rate for the preceding period or+a mathematical blend of unitrust rates over a stated number+of preceding periods; or+ (5) A mathematical blend of any of the unitrust rates+determined under subdivision (2) of subsection 1 of this+section and subdivisions (1) to (4) of this subsection.+ 469.483. 1. A unitrust policy shall provide the+method for determining the fair market value of an asset for+the purpose of determining the unitrust amount, including:+ (1) The frequency of valuing the asset, which need not+require a valuation in every period; and+ (2) The date for valuing the asset in each period in+which the asset is valued.+ 2. Except as otherwise provided in subdivision (2) of+subsection 2 of section 469.487, a unitrust policy may+provide methods for determining the amount of the net fair+market value of the trust to take into account in+determining the applicable value, including:+ (1) Obtaining an appraisal of an asset for which fair+market value is not readily available;++ 101+ (2) Exclusion of specific assets or groups or types of+assets;+ (3) Other exceptions or modifications of the treatment+of specific assets or groups or types of assets;+ (4) Identification and treatment of cash or property+held for distribution;+ (5) Use of:+ (a) An average of fair market values over a stated+number of preceding periods; or+ (b) Another mathematical blend of fair market values+over a stated number of preceding periods;+ (6) A limit on how much the applicable value of all+assets, groups of assets, or individual assets may increase+over:+ (a) The corresponding applicable value for the+preceding period; or+ (b) A mathematical blend of applicable values over a+stated number of preceding periods;+ (7) A limit on how much the applicable value of all+assets, groups of assets, or individual assets may decrease+below:+ (a) The corresponding applicable value for the+preceding period; or+ (b) A mathematical blend of applicable values over a+stated number of preceding periods;+ (8) The treatment of accrued income and other features+of an asset that affect value; and+ (9) Determining the liabilities of the trust,+including treatment of liabilities to conform with the+treatment of assets under subdivisions (1) to (8) of this+subsection.+ 469.485. 1. A unitrust policy shall provide the+period used under sections 469.481 and 469.483. Except as++ 102+otherwise provided in subdivision (3) of subsection 2 of+section 469.481, the period may be:+ (1) A calendar year;+ (2) A twelve-month period other than a calendar year;+ (3) A calendar quarter;+ (4) A three-month period other than a calendar+quarter; or+ (5) Another period.+ 2. Except as otherwise provided in subsection 2 of+section 469.487, a unitrust policy may provide standards for:+ (1) Using fewer preceding periods under paragraph (b)+of subdivision (2) of subsection 1 of section 469.481 or+subdivision (3) or (4) of subsection 2 of section 469.481 if:+ (a) The trust was not in existence in a preceding+period; or+ (b) Market indices or other published data are not+available for a preceding period;+ (2) Using fewer preceding periods under paragraph (a)+or (b) of subdivision (5) of subsection 2 of section+469.483, paragraph (b) of subdivision (6) of subsection 2 of+section 469.483, or paragraph (b) of subdivision (7) of+subsection 2 of section 469.483 if:+ (a) The trust was not in existence in a preceding+period; or+ (b) Fair market values are not available for a+preceding period; and+ (3) Prorating the unitrust amount on a daily basis for+a part of a period in which the trust or the administration+of the trust as a unitrust or the interest of any+beneficiary commences or terminates.+ 469.487. 1. A unitrust policy may:+ (1) Provide methods and standards for:+ (a) Determining the timing of distributions;++ 103+ (b) Making distributions in cash or in kind or partly+in cash and partly in kind; or+ (c) Correcting an underpayment or overpayment to a+beneficiary based on the unitrust amount if there is an+error in calculating the unitrust amount;+ (2) Specify sources and the order of sources,+including categories of income for federal income tax+purposes, from which distributions of a unitrust amount are+paid; or+ (3) Provide other standards and rules the fiduciary+determines serve the interests of the beneficiaries.+ 2. If a trust qualifies for a special tax benefit or a+fiduciary is not an independent person:+ (1) The unitrust rate established under section+469.481 shall not be less than three percent or more than+five percent;+ (2) The only provisions of section 469.483 that apply+are subsection 1 of section 469.483; subdivisions (1), (4),+and (9) of subsection 2 of section 469.483; and paragraph+(a) of subdivision (5) of subsection 2 of section 469.483;+ (3) The only period that may be used under section+469.485 is a calendar year under subdivision (1) of+subsection 1 of section 469.485; and+ (4) The only other provisions of section 469.485 that+apply are paragraph (a) of subdivision (2) of subsection 2+of section 469.485 and subdivision (3) of subsection 2 of+section 469.485.+ 488.426. 1. The judges of the circuit court, en banc,+in any circuit in this state may require any party filing a+civil case in the circuit court, at the time of filing the+suit, to deposit with the clerk of the court a surcharge in+addition to all other deposits required by law or court+rule. Sections 488.426 to 488.432 shall not apply to++ 104+proceedings when costs are waived or are to be paid by the+county or state or any city.+ 2. The surcharge in effect on August 28, 2001, shall+remain in effect until changed by the circuit court. The+circuit court in any circuit, except the circuit court in+Jackson County, the circuit court in the city of St. Louis,+or the circuit court in any circuit that reimburses the+state for the salaries of family court commissioners under+and pursuant to section 487.020, may change the fee to any+amount not to exceed fifteen dollars. The circuit court in+Jackson County, the circuit court in the city of St. Louis,+or the circuit court in any circuit that reimburses the+state for the salaries of family court commissioners under+and pursuant to section 487.020 may change the fee to any+amount not to exceed twenty dollars. A change in the fee+shall become effective and remain in effect until further+changed.+ 3. Sections 488.426 to 488.432 shall not apply to+proceedings when costs are waived or are paid by the county+or state or any city.+ [4. In addition to any fee authorized by subsection 1+of this section, any county of the first classification with+more than one hundred one thousand but fewer than one+hundred fifteen thousand inhabitants may impose an+additional fee of ten dollars excluding cases concerning+adoption and those in small claims court. The provisions of+this subsection shall expire on December 31, 2019.]+ 513.430. 1. The following property shall be exempt+from attachment and execution to the extent of any person's+interest therein:+ (1) Household furnishings, household goods, wearing+apparel, appliances, books, animals, crops or musical+instruments that are held primarily for personal, family or++ 105+household use of such person or a dependent of such person,+not to exceed three thousand dollars in value in the+aggregate;+ (2) A wedding ring not to exceed one thousand five+hundred dollars in value and other jewelry held primarily+for the personal, family or household use of such person or+a dependent of such person, not to exceed five hundred+dollars in value in the aggregate;+ (3) Any other property of any kind, not to exceed in+value six hundred dollars in the aggregate;+ (4) Any implements or professional books or tools of+the trade of such person or the trade of a dependent of such+person not to exceed three thousand dollars in value in the+aggregate;+ (5) Any motor vehicles, not to exceed three thousand+dollars in value in the aggregate;+ (6) Any mobile home used as the principal residence+but not attached to real property in which the debtor has a+fee interest, not to exceed five thousand dollars in value;+ (7) Any one or more unmatured life insurance contracts+owned by such person, other than a credit life insurance+contract, and up to fifteen thousand dollars of any matured+life insurance proceeds for actual funeral, cremation, or+burial expenses where the deceased is the spouse, child, or+parent of the beneficiary;+ (8) The amount of any accrued dividend or interest+under, or loan value of, any one or more unmatured life+insurance contracts owned by such person under which the+insured is such person or an individual of whom such person+is a dependent; provided, however, that if proceedings under+Title 11 of the United States Code are commenced by or+against such person, the amount exempt in such proceedings+shall not exceed in value one hundred fifty thousand dollars++ 106+in the aggregate less any amount of property of such person+transferred by the life insurance company or fraternal+benefit society to itself in good faith if such transfer is+to pay a premium or to carry out a nonforfeiture insurance+option and is required to be so transferred automatically+under a life insurance contract with such company or society+that was entered into before commencement of such+proceedings. No amount of any accrued dividend or interest+under, or loan value of, any such life insurance contracts+shall be exempt from any claim for child support.+Notwithstanding anything to the contrary, no such amount+shall be exempt in such proceedings under any such insurance+contract which was purchased by such person within one year+prior to the commencement of such proceedings;+ (9) Professionally prescribed health aids for such+person or a dependent of such person;+ (10) Such person's right to receive:+ (a) A Social Security benefit, unemployment+compensation or a public assistance benefit;+ (b) A veteran's benefit;+ (c) A disability, illness or unemployment benefit;+ (d) Alimony, support or separate maintenance, not to+exceed seven hundred fifty dollars a month;+ (e) a. Any payment under a stock bonus plan, pension+plan, disability or death benefit plan, profit-sharing plan,+nonpublic retirement plan or any plan described, defined, or+established pursuant to section 456.014, the person's right+to a participant account in any deferred compensation+program offered by the state of Missouri or any of its+political subdivisions, or annuity or similar plan or+contract on account of illness, disability, death, age or+length of service, to the extent reasonably necessary for++ 107+the support of such person and any dependent of such person+unless:+ (i) Such plan or contract was established by or under+the auspices of an insider that employed such person at the+time such person's rights under such plan or contract arose;+ (ii) Such payment is on account of age or length of+service; and+ (iii) Such plan or contract does not qualify under+Section 401(a), 403(a), 403(b), 408, 408A or 409 of the+Internal Revenue Code of 1986, as amended, (26 U.S.C.+Section 401(a), 403(a), 403(b), 408, 408A or 409).+ b. Notwithstanding the exemption provided in+subparagraph a. of this paragraph, any such payment to any+person shall be subject to attachment or execution pursuant+to a qualified domestic relations order, as defined by+Section 414(p) of the Internal Revenue Code of 1986 (26+U.S.C. Section 414(p)), as amended, issued by a court in any+proceeding for dissolution of marriage or legal separation+or a proceeding for disposition of property following+dissolution of marriage by a court which lacked personal+jurisdiction over the absent spouse or lacked jurisdiction+to dispose of marital property at the time of the original+judgment of dissolution;+ (f) Any money or assets, payable to a participant or+beneficiary from, or any interest of any participant or+beneficiary in, a retirement plan, profit-sharing plan,+health savings plan, or similar plan, including an inherited+account or plan, that is qualified under Section 401(a),+403(a), 403(b), 408, 408A or 409 of the Internal Revenue+Code of 1986 (26 U.S.C. Section 401(a), 403(a), 403(b), 408,+408A, or 409), as amended, whether such participant's or+beneficiary's interest arises by inheritance, designation,+appointment, or otherwise, except as provided in this++ 108+paragraph. Any plan or arrangement described in this+paragraph shall not be exempt from the claim of an alternate+payee under a qualified domestic relations order or assignee+pursuant to a final judgment of dissolution of marriage or+legal separation; however, the interest of any and all+alternate payees under a qualified domestic relations order+or assignees pursuant to a final judgment of dissolution of+marriage or legal separation shall be exempt from any and+all claims of any creditor, other than the state of Missouri+through its department of social services, as of the time+the interest is awarded or received, and continues to be+exempt thereafter. As used in this paragraph, the terms+"alternate payee" and "qualified domestic relations order"+have the meaning given to them in Section 414(p) of the+Internal Revenue Code of 1986 (26 U.S.C. Section 414(p)), as+amended. If proceedings under Title 11 of the United States+Code are commenced by or against such person, no amount of+funds shall be exempt in such proceedings under any such+plan, contract, or trust which is fraudulent as defined in+subsection 2 of section 428.024 and for the period such+person participated within three years prior to the+commencement of such proceedings. For the purposes of this+section, when the fraudulently conveyed funds are recovered+and after, such funds shall be deducted and then treated as+though the funds had never been contributed to the plan,+contract, or trust;+ (11) The debtor's right to receive, or property that+is traceable to, a payment on account of the wrongful death+of an individual of whom the debtor was a dependent, to the+extent reasonably necessary for the support of the debtor+and any dependent of the debtor;++ 109+ (12) Firearms, firearm accessories, and ammunition,+not to exceed one thousand five hundred dollars in value in+the aggregate;+ (13) Any moneys accruing to and deposited in+individual savings accounts or individual deposit accounts+under sections 166.400 to 166.456 or sections 166.500 to+166.529, subject to the following provisions:+ (a) This subdivision shall apply to any proceeding+that:+ a. Is filed on or after January 1, 2022; or+ b. Was filed before January 1, 2022, and is pending or+on appeal after January 1, 2022;+ (b) Except as provided by paragraph (c) of this+subdivision, if the designated beneficiary of an individual+savings account or individual deposit account established+under sections 166.400 to 166.456 or sections 166.500 to+166.529 is a lineal descendant of the account owner, all+moneys in the account shall be exempt from any claims of+creditors of the account owner or designated beneficiary;+ (c) The provisions of paragraph (b) of this+subdivision shall not apply to:+ a. Claims of any creditor of an account owner as to+amounts contributed within a two-year period preceding the+date of the filing of a bankruptcy petition under 11 U.S.C.+Section 101 et seq., as amended; or+ b. Claims of any creditor of an account owner as to+amounts contributed within a one-year period preceding an+execution on judgment for such claims against the account+owner.+ 2. Nothing in this section shall be interpreted to+exempt from attachment or execution for a valid judicial or+administrative order for the payment of child support or+maintenance any money or assets, payable to a participant or++ 110+beneficiary from, or any interest of any participant or+beneficiary in, a retirement plan which is qualified+pursuant to Sections 408 and 408A of the Internal Revenue+Code of 1986 (26 U.S.C. Sections 408 and 408A), as amended.+ 536.085. As used in section 536.087, the following+terms mean:+ (1) "Agency proceeding", an adversary proceeding in a+contested case pursuant to this chapter in which the state+is represented by counsel, but does not include proceedings+for determining the eligibility or entitlement of an+individual to a monetary benefit or its equivalent, child+custody proceedings, eminent domain proceedings, driver's+license proceedings, vehicle registration proceedings,+proceedings to establish or fix a rate, or proceedings+before the state tax commission;+ (2) "Party":+ (a) An individual whose net worth did not exceed two+million dollars at the time the civil action or agency+proceeding was initiated; or+ (b) Any owner of an unincorporated business or any+partnership, corporation, association, unit of local+government or organization, the net worth of which did not+exceed seven million dollars at the time the civil action or+agency proceeding was initiated, and which had not more than+five hundred employees at the time the civil action or+agency proceeding was initiated;+ (3) "Prevails", obtains a favorable order, decision,+judgment, or dismissal in a civil action or agency+proceeding;+ (4) "Reasonable fees and expenses" includes the+reasonable expenses of expert witnesses, the reasonable cost+of any study, analysis, engineering report, test, or project+which is found by the court or agency to be necessary for++ 111+the preparation of the party's case, and reasonable attorney+or agent fees. The amount of fees awarded as reasonable+fees and expenses shall be based upon prevailing market+rates for the kind and quality of the services furnished,+except that no expert witness shall be compensated at a rate+in excess of the highest rate of compensation for expert+witnesses paid by the state in the type of civil action or+agency proceeding[, and attorney fees shall not be awarded+in excess of seventy-five dollars per hour unless the court+determines that a special factor, such as the limited+availability of qualified attorneys for the proceedings+involved, justifies a higher fee];+ (5) "State", the state of Missouri, its officers and+its agencies, but shall not include political subdivisions+of the state.+ 537.529. 1. This section shall be known and may be+cited as the "Uniform Public Expression Protection Act".+ 2. As used in this section, the following terms mean:+ (1) "Governmental unit", any city, county, or other+political subdivision of this state, or any department,+division, board, or other agency of any political+subdivision of this state;+ (2) "Person", an individual, estate, trust,+partnership, business or nonprofit entity, governmental+unit, or other legal entity.+ 3. Except as otherwise provided in subsection 4 of+this section, the provisions of this section shall apply to+any cause of action asserted in a civil action against a+person based on the person's:+ (1) Communication in a legislative, executive,+judicial, administrative, or other governmental proceeding;++ 112+ (2) Communication on an issue under consideration or+review in a legislative, executive, judicial,+administrative, or other governmental proceeding; or+ (3) Exercise of the right of freedom of speech or of+the press, the right to assemble or petition, or the right+of association, guaranteed by the Constitution of the United+States or the Constitution of the state of Missouri, on a+matter of public concern.+ 4. The provisions of this section shall not apply to a+cause of action asserted:+ (1) Against a governmental unit or an employee or+agent of a governmental unit acting or purporting to act in+an official capacity;+ (2) By a governmental unit or an employee or agent of+a governmental unit acting in an official capacity to+enforce a law to protect against an imminent threat to+public health or safety; or+ (3) Against a person primarily engaged in the business+of selling or leasing goods or services if the cause of+action arises out of a communication related to the person's+sale or lease of the goods or services.+As used in this subsection, the term "goods or services"+shall not include any dramatic, literary, musical,+political, journalistic, or artistic work.+ 5. No later than sixty days after a party is served+with a complaint, crossclaim, counterclaim, third-party+claim, or other pleading that asserts a cause of action to+which this section applies, or at a later time upon a+showing of good cause, a party may file a special motion to+dismiss the cause of action or part of the cause of action.+ 6. (1) Except as otherwise provided in this+subsection:++ 113+ (a) All other proceedings between the moving party and+responding party in an action, including discovery and a+pending hearing or motion, are stayed on the filing of a+motion under subsection 5 of this section; and+ (b) On motion by the moving party, the court may stay:+ a. A hearing or motion involving another party if the+ruling on the hearing or motion would adjudicate a legal or+factual issue that is material to the motion under+subsection 5 of this section; or+ b. Discovery by another party if the discovery relates+to a legal or factual issue that is material to the motion+under subsection 5 of this section.+ (2) A stay under subdivision (1) of this subsection+remains in effect until entry of an order ruling on the+motion filed under subsection 5 of this section and the+expiration of the time to appeal the order.+ (3) If a party appeals from an order ruling on a+motion under subsection 5 of this section, all proceedings+between all parties in an action are stayed. The stay+remains in effect until the conclusion of the appeal.+ (4) During a stay under subdivision (1) of this+subsection, the court may allow limited discovery if a party+shows that specific information is necessary to establish+whether a party has satisfied or failed to satisfy a burden+imposed by subdivision (1) of subsection 9 of this section+and is not reasonably available without discovery.+ (5) A motion for costs and expenses under subsection+12 of this section shall not be subject to a stay under this+section.+ (6) A stay under this subsection does not affect a+party's ability to voluntarily dismiss a cause of action or+part of a cause of action or move to sever a cause of action.++ 114+ (7) During a stay under this section, the court for+good cause may hear and rule on:+ (a) A motion unrelated to the motion under subsection+5 of this section; and+ (b) A motion seeking a special or preliminary+injunction to protect against an imminent threat to public+health or safety.+ 7. (1) The court shall hear a motion under subsection+5 of this section no later than sixty days after filing of+the motion, unless the court orders a later hearing:+ (a) To allow discovery under subdivision (4) of+subsection 6 of this section; or+ (b) For other good cause.+ (2) If the court orders a later hearing under+paragraph (a) of subdivision (1) of this subsection, the+court shall hear the motion under subsection 5 of this+section no later than sixty days after the court order+allowing the discovery, subject to paragraph (b) of+subdivision (1) of this subsection.+ 8. In ruling on a motion under subsection 5 of this+section, the court shall consider the parties' pleadings,+the motion, any replies and responses to the motion, and any+evidence that could be considered in ruling on a motion for+summary judgment.+ 9. (1) In ruling on a motion under subsection 5 of+this section, the court shall dismiss with prejudice a cause+of action or part of a cause of action if:+ (a) The moving party establishes under subsection 3 of+this section that this section applies;+ (b) The responding party fails to establish as+provided in subsection 4 of this section that this section+does not apply; and+ (c) Either:++ 115+ a. The responding party fails to establish a prima+facie case as to each essential element of the cause of+action; or+ b. The moving party establishes that:+ (i) The responding party failed to state a cause of+action upon which relief can be granted; or+ (ii) There is no genuine issue as to any material fact+and the party is entitled to judgment as a matter of law on+the cause of action or part of the cause of action.+ (2) A voluntary dismissal without prejudice of a+responding party's cause of action, or part of a cause of+action, that is the subject of a motion under subsection 5+of this section does not affect a moving party's right to+obtain a ruling on the motion and seek costs, reasonable+attorney's fees, and reasonable litigation expenses under+subsection 12 of this section.+ (3) A voluntary dismissal with prejudice of a+responding party's cause of action, or part of a cause of+action, that is the subject of a motion under subsection 5+of this section establishes for the purpose of subsection 12+of this section that the moving party prevailed on the+motion.+ 10. The court shall rule on a motion under subsection+5 of this section no later than sixty days after the hearing+under subsection 7 of this section.+ 11. A moving party may appeal within twenty-one days+as a matter of right from an order denying, in whole or in+part, a motion under subsection 5 of this section.+ 12. On a motion under subsection 5 of this section,+the court shall award costs, reasonable attorney's fees, and+reasonable litigation expenses related to the motion:+ (1) To the moving party if the moving party prevails+on the motion; or++ 116+ (2) To the responding party if the responding party+prevails on the motion and the court finds that the motion+was frivolous or filed solely with intent to delay the+proceeding.+ 13. This section shall be broadly construed and+applied to protect the exercise of the right of freedom of+speech and of the press, the right to assemble and petition,+and the right of association, guaranteed by the Constitution+of the United States or the Constitution of the state of+Missouri.+ 14. In applying and construing this section,+consideration shall be given to the need to promote+uniformity of the law with respect to its subject matter+among states that enact it.+ 15. The provisions of this section shall apply to any+civil action filed, or any cause of action asserted in a+civil action, on or after August 28, 2026.+ [469.409. 1. Any claim for breach of a+trustee's duty to impartially administer a trust+related, directly or indirectly, to an+adjustment made by a fiduciary to the allocation+between principal and income pursuant to+subsection 1 of section 469.405 or any+allocation made by the fiduciary pursuant to any+authority or discretion specified in subsection+1 of section 469.403, unless previously barred+by adjudication, consent or other limitation,+shall be barred as provided in this section.+ (1) Any such claim brought by a qualified+beneficiary is barred if not asserted in a+judicial proceeding commenced within two years+after the trustee has sent a report to that+qualified beneficiary that adequately discloses+the facts constituting the claim.+ (2) Any such claim brought by a+beneficiary (other than a qualified beneficiary)+with any interest whatsoever in the trust, no+matter how remote or contingent, or whether or+not the beneficiary is ascertainable or has the++ 117+capacity to contract, is barred if not asserted+in a judicial proceeding commenced within two+years after the first to occur of:+ (a) The date the trustee sent a report to+all qualified beneficiaries that adequately+discloses the facts constituting the claim; or+ (b) The date the trustee sent a report to+a person that represents the beneficiary under+the provisions of subdivision (2) of subsection+2 of this section.+ 2. For purposes of this section the+following rules shall apply:+ (1) A report adequately discloses the+facts constituting a claim if it provides+sufficient information so that the beneficiary+should know of the claim or reasonably should+have inquired into its existence;+ (2) Section 469.402 shall apply in+determining whether a beneficiary (including a+qualified beneficiary) has received notice for+purposes of this section;+ (3) The determination of the identity of+all qualified beneficiaries shall be made on the+date the report is deemed to have been sent; and+ (4) This section does not preclude an+action to recover for fraud or misrepresentation+related to the report.]+ [469.411. 1. (1) If the provisions of+this section apply to a trust, the unitrust+amount determined for each accounting year of+the trust shall be a percentage between three+and five percent of the average net fair market+value of the trust, as of the first day of the+trust's current accounting year. The percentage+applicable to a trust shall be that percentage+specified by the terms of the governing+instrument or by the election made in accordance+with subdivision (2) of subsection 5 of this+section.+ (2) The unitrust amount for the current+accounting year computed pursuant to this+section shall be proportionately reduced for any+distributions, in whole or in part, other than+distributions of the unitrust amount, and for+any payments of expenses, including debts,++ 118+disbursements and taxes, from the trust within a+current accounting year that the trustee+determines to be material and substantial, and+shall be proportionately increased for the+receipt, other than a receipt that represents a+return on investment, of any additional property+into the trust within a current accounting year.+ (3) For purposes of this section, the net+fair market values of the assets held in the+trust on the first business day of a prior+accounting quarter shall be adjusted to reflect+any reduction, in the case of a distribution or+payment, or increase, in the case of a receipt,+for the prior accounting year pursuant to+subdivision (1) of this subsection, as if the+distribution, payment or receipt had occurred on+the first day of the prior accounting year.+ (4) In the case of a short accounting+period, the trustee shall prorate the unitrust+amount on a daily basis.+ (5) In the case where the net fair market+value of an asset held in the trust has been+incorrectly determined in any quarter, the+unitrust amount shall be increased in the case+of an undervaluation, or be decreased in the+case of an overvaluation, by an amount equal to+the difference between the unitrust amount+determined based on the correct valuation of the+asset and the unitrust amount originally+determined.+ 2. As used in this section, the following+terms mean:+ (1) "Average net fair market value", a+rolling average of the fair market value of the+assets held in the trust on the first business+day of the lessor of the number of accounting+quarters of the trust from the date of inception+of the trust to the determination of the trust's+average net fair market value, or twelve+accounting quarters of the trust, regardless of+whether this section applied to the+ascertainment of net income for all valuation+quarters;+ (2) "Current accounting year", the+accounting period of the trust for which the+unitrust amount is being determined.++ 119+ 3. In determining the average net fair+market value of the assets held in the trust,+there shall not be included the value of:+ (1) Any residential property or any+tangible personal property that, as of the first+business day of the current valuation year, one+or more income beneficiaries of the trust have+or had the right to occupy, or have or had the+right to possess or control, other than in a+capacity as trustee, and instead the right of+occupancy or the right to possession or control+shall be deemed to be the unitrust amount with+respect to the residential property or the+tangible personal property; or+ (2) Any asset specifically given to a+beneficiary under the terms of the trust and the+return on investment on that asset, which return+on investment shall be distributable to the+beneficiary.+ 4. In determining the average net fair+market value of the assets held in the trust+pursuant to subsection 1 of this section, the+trustee shall, not less often than annually,+determine the fair market value of each asset of+the trust that consists primarily of real+property or other property that is not traded on+a regular basis in an active market by appraisal+or other reasonable method or estimate, and that+determination, if made reasonably and in good+faith, shall be conclusive as to all persons+interested in the trust. Any claim based on a+determination made pursuant to this subsection+shall be barred if not asserted in a judicial+proceeding brought by any beneficiary with any+interest whatsoever in the trust within two+years after the trustee has sent a report to all+qualified beneficiaries that adequately+discloses the facts constituting the claim. The+rules set forth in subsection 2 of section+469.409 shall apply to the barring of claims+pursuant to this subsection.+ 5. This section shall apply to the+following trusts:+ (1) Any trust created after August 28,+2001, with respect to which the terms of the++ 120+trust clearly manifest an intent that this+section apply;+ (2) Any trust created under an instrument+that became irrevocable on, before, or after+August 28, 2001, if the trustee, in the+trustee's discretion, elects to have this+section apply unless the instrument creating the+trust specifically prohibits an election under+this subdivision. The trustee shall deliver+notice to all qualified beneficiaries and the+settlor of the trust, if he or she is then+living, of the trustee's intent to make such an+election at least sixty days before making that+election. The trustee shall have sole authority+to make the election. Section 469.402 shall+apply for all purposes of this subdivision. An+action or order by any court shall not be+required. The election shall be made by a+signed writing delivered to the settlor of the+trust, if he or she is then living, and to all+qualified beneficiaries. The election is+irrevocable, unless revoked by order of the+court having jurisdiction of the trust. The+election may specify the percentage used to+determine the unitrust amount pursuant to this+section, provided that such percentage is+between three and five percent, or if no+percentage is specified, then that percentage+shall be three percent. In making an election+pursuant to this subsection, the trustee shall+be subject to the same limitations and+conditions as apply to an adjustment between+income and principal pursuant to subsections 3+and 4 of section 469.405; and+ (3) No action of any kind based on an+election made by a trustee pursuant to+subdivision (2) of this subsection shall be+brought against the trustee by any beneficiary+of that trust three years from the effective+date of that election.+ 6. (1) Once the provisions of this+section become applicable to a trust, the net+income of the trust shall be the unitrust amount.+ (2) Unless otherwise provided by the+governing instrument, the unitrust amount+distributed each year shall be paid from the++ 121+following sources for that year up to the full+value of the unitrust amount in the following+order:+ (a) Net income as determined if the trust+were not a unitrust;+ (b) Other ordinary income as determined+for federal income tax purposes;+ (c) Assets of the trust principal for+which there is a readily available market value;+and+ (d) Other trust principal.+ (3) Additionally, the trustee may allocate+to trust income for each taxable year of the+trust, or portion thereof:+ (a) Net short-term capital gain described+in the Internal Revenue Code, 26 U.S.C. Section+1222(5), for such year, or portion thereof, but+only to the extent that the amount so allocated+together with all other amounts to trust income,+as determined under the provisions of this+chapter without regard to this section, for such+year, or portion thereof, does not exceed the+unitrust amount for such year, or portion+thereof;+ (b) Net long-term capital gain described+in the Internal Revenue Code, 26 U.S.C. Section+1222(7), for such year, or portion thereof, but+only to the extent that the amount so allocated+together with all other amounts, including+amounts described in paragraph (a) of this+subdivision, allocated to trust income for such+year, or portion thereof, does not exceed the+unitrust amount for such year, or portion+thereof.+ 7. A trust with respect to which this+section applies on August 28, 2011, may+calculate the unitrust amount in accordance with+the provisions of this section, as it existed+either before or after such date, as the trustee+of such trust shall determine in a writing kept+with the records of the trust in the trustee's+discretion.]+ [469.461. 1. A fiduciary may make+adjustments between principal and income to+offset the shifting of economic interests or tax++ 122+benefits between income beneficiaries and+remainder beneficiaries which arise from:+ (1) Elections and decisions, other than+those described in subsection 2 of this section,+that the fiduciary makes from time to time+regarding tax matters;+ (2) An income tax or any other tax that is+imposed upon the fiduciary or a beneficiary as a+result of a transaction involving or a+distribution from the estate or trust; or+ (3) The ownership by an estate or trust of+an interest in an entity whose taxable income,+whether or not distributed, is includable in the+taxable income of the estate, trust or a+beneficiary.+ 2. If the amount of an estate tax marital+deduction or charitable contribution deduction+is reduced because a fiduciary deducts an amount+paid from principal for income tax purposes+instead of deducting it for estate tax purposes,+and as a result estate taxes paid from principal+are increased and income taxes paid by an+estate, trust or beneficiary are decreased, each+estate, trust or beneficiary that benefits from+the decrease in income tax shall reimburse the+principal from which the increase in estate tax+is paid. The total reimbursement shall equal+the increase in the estate tax to the extent+that the principal used to pay the increase+would have qualified for a marital deduction or+charitable contribution deduction but for the+payment. The proportionate share of the+reimbursement for each estate, trust or+beneficiary whose income taxes are reduced shall+be the same as its proportionate share of the+total decrease in income tax. An estate or+trust shall reimburse principal from income.]+ [537.528. 1. Any action against a person+for conduct or speech undertaken or made in+connection with a public hearing or public+meeting, in a quasi-judicial proceeding before a+tribunal or decision-making body of the state or+any political subdivision of the state is+subject to a special motion to dismiss, motion+for judgment on the pleadings, or motion for++ 123+summary judgment that shall be considered by the+court on a priority or expedited basis to ensure+the early consideration of the issues raised by+the motion and to prevent the unnecessary+expense of litigation. Upon the filing of any+special motion described in this subsection, all+discovery shall be suspended pending a decision+on the motion by the court and the exhaustion of+all appeals regarding the special motion.+ 2. If the rights afforded by this section+are raised as an affirmative defense and if a+court grants a motion to dismiss, a motion for+judgment on the pleadings or a motion for+summary judgment filed within ninety days of the+filing of the moving party's answer, the court+shall award reasonable attorney fees and costs+incurred by the moving party in defending the+action. If the court finds that a special+motion to dismiss or motion for summary judgment+is frivolous or solely intended to cause+unnecessary delay, the court shall award costs+and reasonable attorney fees to the party+prevailing on the motion.+ 3. Any party shall have the right to an+expedited appeal from a trial court order on the+special motions described in subsection 2 of+this section or from a trial court's failure to+rule on the motion on an expedited basis.+ 4. As used in this section, a "public+meeting in a quasi-judicial proceeding" means+and includes any meeting established and held by+a state or local governmental entity, including+without limitations meetings or presentations+before state, county, city, town or village+councils, planning commissions, review boards or+commissions.+ 5. Nothing in this section limits or+prohibits the exercise of a right or remedy of a+party granted pursuant to another+constitutional, statutory, common law or+administrative provision, including civil+actions for defamation.+ 6. If any provision of this section or the+application of any provision of this section to+a person or circumstance is held invalid, the+invalidity shall not affect other provisions or++ 124+applications of this section that can be given+effect without the invalid provision or+application, and to this end the provisions of+this section are severable.+ 7. The provisions of this section shall+apply to all causes of actions.]
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