HB 241 -- Trusts and Estates

Sponsor:  Smith

This bill revises the law governing principal and income in the
administration of trusts.  The bill:

(1)  Redefines the standards and processes used to determine
which parts of a trust constitute principal and which constitute
income from that principal, as well as trustees' obligations in
administering those trusts;

(2)  Repeals much of the existing law in the sub-chapter
governing principal and income, replacing it with terminology
and standards consistent with the Prudent Investor Act, enacted
in 1996, and incorporating many of the changes in the federal
income tax code since 1983;

(3)  Clarifies that the terms of a trust control in the
administration of the trust, that the statutes serve as a
default mechanism only, and that money and property are presumed
principal if the terms of the trust or statutes do not dictate;
and

(4)  Reduces the statute of limitations, from 5 years to 2
years, for claims of breach of trust resulting from a trustee's
allocation of income and principal.

Missouri House of Representatives
Last Updated November 26, 2001 at 11:43 am