Florida Senate - 2022 CS for SB 1368 By the Committee on Banking and Insurance; and Senator Gruters 597-02839A-22 20221368c1 1 A bill to be entitled 2 An act relating to trusts; amending s. 689.225, F.S.; 3 revising criteria for application of the rule against 4 perpetuities to trusts created on or after a specified 5 date; amending s. 736.0105, F.S.; specifying that the 6 terms of a trust do not prevail over a trustees duty 7 to account to qualified beneficiaries under certain 8 circumstances; amending s. 736.0109, F.S.; clarifying 9 circumstances under which notice, or the sending of a 10 document, to a person under the Florida Trust Code is 11 deemed satisfied; authorizing certain trust companies 12 that are trustees to use specified methods for 13 providing notice or sending a document; specifying 14 when such notice or document is deemed sent; amending 15 s. 736.0303, F.S.; specifying circumstances under 16 which a parent may represent and bind the unborn 17 descendants of his or her unborn child or the minor or 18 unborn descendants of his or her minor child; amending 19 s. 736.0409, F.S.; revising the timeframe for which 20 certain noncharitable trusts may be enforced; amending 21 s. 736.0813, F.S.; providing that the terms of a trust 22 may permit for accounting to the qualified 23 beneficiaries only under certain circumstances; 24 providing construction; amending s. 736.08135, F.S.; 25 providing an alternate procedure for trust accountings 26 for specified trustees under certain circumstances; 27 specifying requirements and applicability; amending s. 28 736.08145, F.S.; clarifying the application of law 29 governing grantor trust reimbursement; providing an 30 effective date. 31 32 Be It Enacted by the Legislature of the State of Florida: 33 34 Section 1.Paragraph (f) of subsection (2) of section 35 689.225, Florida Statutes, is amended, and paragraph (g) is 36 added to that subsection, to read: 37 689.225Statutory rule against perpetuities. 38 (2)STATEMENT OF THE RULE. 39 (f)As to any trust created after December 31, 2000, 40 through June 30, 2022, this section shall apply to a nonvested 41 property interest or power of appointment contained in a trust 42 by substituting 360 years in place of 90 years in each place 43 such term appears in this section unless the terms of the trust 44 require that all beneficial interests in the trust vest or 45 terminate within a lesser period. 46 (g)As to any trust created on or after July 1, 2022, this 47 section shall apply to a nonvested property interest or power of 48 appointment contained in a trust by substituting 1,000 years in 49 place of 90 years in each place such term appears in this 50 section unless the terms of the trust require that all 51 beneficial interests in the trust vest or terminate within a 52 lesser period. 53 Section 2.Paragraph (s) of subsection (2) of section 54 736.0105, Florida Statutes, is amended to read: 55 736.0105Default and mandatory rules. 56 (2)The terms of a trust prevail over any provision of this 57 code except: 58 (s)The duty under s. 736.0813(1)(c) and (d) to provide a 59 complete copy of the trust instrument and to account to 60 qualified beneficiaries except as otherwise provided in s. 61 736.0813(1)(d). 62 Section 3.Present subsections (4), (5), and (6) of section 63 736.0109, Florida Statutes, are redesignated as subsections (5), 64 (6), and (7), respectively, a new subsection (4) is added to 65 that section, and subsection (1) and present subsection (4) of 66 that section are amended, to read: 67 736.0109Methods and waiver of notice. 68 (1)Notice to a person under this code or the sending of a 69 document to a person under this code must be accomplished in a 70 manner reasonably suitable under the circumstances and likely to 71 result in receipt of the notice or document. Permissible methods 72 of notice or for sending a document include first-class mail, 73 personal delivery, delivery to the persons last known place of 74 residence or place of business, a properly directed facsimile or 75 other electronic message, including e-mail, or posting on a 76 secure electronic account or website in accordance with 77 subsection (3). 78 (4)Notwithstanding subsection (3), a family trust company, 79 licensed family trust company, or foreign licensed family trust 80 company, as defined in s. 662.111, that is a trustee of a trust 81 may use any permissible method for providing notice or for 82 sending a document specified in subsection (1) or may send a 83 properly directed e-mail that contains an attached notice or 84 document or contains a hyperlink through which the recipient can 85 view the notice or document as a permissible method of providing 86 notice or sending a document. For purposes of this subsection, 87 such notice or document sent by e-mail is deemed to have been 88 sent if any username, password, or other specific instructions 89 needed to access the notice or document are communicated to the 90 recipient beforehand or contemporaneously with the sending of 91 the e-mail message containing the notice, document, or 92 hyperlink, or upon the request of the recipient. 93 (5)(4)Notice to a person under this code, or the sending 94 of a document to a person under this code electronically by 95 electronic message, is complete when the document is sent. 96 (a)An electronic message is presumed received on the date 97 that the message is sent. 98 (b)If the sender has knowledge that an electronic message 99 did not reach the recipient, the electronic message is deemed to 100 have not been received. The sender has the burden to prove that 101 another copy of the notice or document was sent by electronic 102 message or by other means authorized by this section. 103 Section 4.Subsection (5) of section 736.0303, Florida 104 Statutes, is amended to read: 105 736.0303Representation by fiduciaries and parents.To the 106 extent there is no conflict of interest between the 107 representative and the person represented or among those being 108 represented with respect to a particular question or dispute: 109 (5)A parent may represent and bind the parents unborn 110 child and the unborn descendants of such unborn child, or the 111 parents minor child and the minor or unborn descendants of such 112 minor child, if a guardian of the property for the unborn child, 113 minor child, or such childs descendants has not been appointed. 114 Section 5.Subsection (1) of section 736.0409, Florida 115 Statutes, is amended to read: 116 736.0409Noncharitable trust without ascertainable 117 beneficiary.Except as otherwise provided in s. 736.0408 or by 118 another provision of law, the following rules apply: 119 (1)A trust may be created for a noncharitable purpose 120 without a definite or definitely ascertainable beneficiary or 121 for a noncharitable but otherwise valid purpose to be selected 122 by the trustee. The trust may not be enforced for more than 123 1,000 21 years. 124 Section 6.Paragraph (d) of subsection (1) of section 125 736.0813, Florida Statutes, is amended to read: 126 736.0813Duty to inform and account.The trustee shall keep 127 the qualified beneficiaries of the trust reasonably informed of 128 the trust and its administration. 129 (1)The trustees duty to inform and account includes, but 130 is not limited to, the following: 131 (d)A trustee of an irrevocable trust shall provide a trust 132 accounting, as set forth in s. 736.08135, from the date of the 133 last accounting or, if none, from the date on which the trustee 134 became accountable, to each qualified beneficiary at least 135 annually and on termination of the trust or on change of the 136 trustee. Notwithstanding s. 736.0105 or the duties under this 137 paragraph, if a family trust company, licensed family trust 138 company, or foreign licensed family trust company, as defined in 139 s. 662.111, is a trustee of an irrevocable trust, the terms of 140 the trust may permit for accounting to the qualified 141 beneficiaries only at the termination of the trust; upon the 142 removal, resignation, or other event resulting in a trustee 143 ceasing to serve as a trustee; or upon demand of a qualified 144 beneficiary or the representative of a qualified beneficiary. 145 This paragraph may not be construed to prohibit a trustee that 146 is a family trust company, licensed family trust company, or 147 foreign licensed family trust company from voluntarily 148 accounting to the qualified beneficiaries annually or at other 149 times selected by such trustee. 150 151 Paragraphs (a) and (b) do not apply to an irrevocable trust 152 created before the effective date of this code, or to a 153 revocable trust that becomes irrevocable before the effective 154 date of this code. Paragraph (a) does not apply to a trustee who 155 accepts a trusteeship before the effective date of this code. 156 Section 7.Present subsection (3) of section 736.08135, 157 Florida Statutes, is redesignated as subsection (4) and amended, 158 and a new subsection (3) is added to that section, to read: 159 736.08135Trust accountings. 160 (3)Notwithstanding subsections (1) and (2), if a family 161 trust company, licensed family trust company, or foreign 162 licensed family trust company, as defined in s. 662.111, is a 163 trustee of the trust, such trustee may elect, for any accounting 164 period, to provide the qualified beneficiaries with all of the 165 following information: 166 (a)A notice stating that the trustee has made an election 167 to provide the information described in this subsection. 168 (b)The information required by paragraph (2)(a) and, if 169 applicable, the information required by paragraph (2)(f). 170 (c)A financial statement for the trust which summarizes 171 the information provided pursuant to paragraphs (2)(b)-(e). The 172 financial statement must contain sufficient information to put 173 the beneficiary on notice of the trusts comprehensive assets 174 and liabilities as well as of the transactions occurring during 175 the accounting period. A financial statement that reports a 176 summary of the comprehensive assets and liabilities at the 177 beginning and end of the accounting period and the aggregate 178 amounts of all cash and property transactions, gains, losses, 179 receipts, expenses, disbursements, distributions, accruals, or 180 allowances occurring within the accounting period for each 181 category of assets and liabilities meets the requirements of 182 this paragraph. 183 184 For the purposes of this chapter, a financial statement that a 185 trustee provides to a beneficiary of a trust under this 186 subsection is deemed to be a trust accounting. Any trustee that 187 makes the election provided in this subsection shall, upon 188 request of any beneficiary made within the limitations period 189 under s. 736.1008, make available the detailed information 190 necessary for preparation of the financial statement to the 191 beneficiary within 30 days after the date of such request, 192 including providing copies of the requested information. A 193 request by a beneficiary for the detailed information necessary 194 for the preparation of the financial statement tolls the running 195 of any applicable limitations period until the detailed 196 information is made available to the beneficiary. 197 (4)(3)Subsections (1) and (2) govern the form and content 198 of all trust accountings rendered for any accounting periods 199 beginning on or after January 1, 2003, and all trust accountings 200 rendered on or after July 1, 2018. The election provided in 201 subsection (3) for trusts for which a family trust company, 202 licensed family trust company, or foreign licensed family trust 203 company, as defined in s. 662.111, is a trustee is available for 204 any accounting periods beginning on or after July 1, 2022. This 205 subsection does not affect the beginning period from which a 206 trustee is required to render a trust accounting. 207 Section 8.Subsection (2) of section 736.08145, Florida 208 Statutes, is amended to read: 209 736.08145Grantor trust reimbursement. 210 (2)This section applies to all trusts that are governed by 211 the laws of this state or that have a principal place of 212 administration within this state, whether created on, before, or 213 after July 1, 2020, unless: 214 (a)The trustee provides written notification that the 215 trustee intends to irrevocably elect out of the application of 216 this section, at least 60 days before the effective date of such 217 election, to the person treated as the owner of all or a portion 218 of the trust under s. 671 of the Internal Revenue Code or any 219 similar federal, state, or other tax law and to all persons who 220 have the ability to remove and replace the trustee. 221 (b)Applying this section would prevent a contribution to 222 the trust from qualifying for, or would reduce, a federal tax 223 benefit, including a federal tax exclusion or deduction, which 224 was originally claimed or could have been claimed for the 225 contribution, including: 226 1.An exclusion under s. 2503(b) or s. 2503(c) of the 227 Internal Revenue Code; 228 2.A marital deduction under s. 2056, s. 2056A, or s. 2523 229 of the Internal Revenue Code; 230 3.A charitable deduction under s. 170(a), s. 642(c), s. 231 2055(a), or s. 2522(a) of the Internal Revenue Code; or 232 4.Direct skip treatment under s. 2642(c) of the Internal 233 Revenue Code. 234 Section 9.This act shall take effect July 1, 2022.