SESSION OF 2023
SUPPLEMENTAL NOTE ON HOUSE BILL NO. 2144
As Recommended by House Committee on
Judiciary
Brief*
HB 2144 would amend law in the Kansas Uniform Trust
Code, Kansas Probate Code, and Kansas Income Tax Act
with respect to the statutory rule against perpetuities (RAP).
[Note: The Uniform Statutory RAP contained in the Kansas
Probate Code states that a nonvested property interest is
invalid unless such property is certain to vest or terminate no
later than 21 years after the death of an individual that is alive
when the interest is created, or unless such interest either
vests or terminates within 90 years after its creation.]
Modification or Termination of Noncharitable Irrevocable
Trust by Consent
The bill would amend a provision in the Kansas Uniform
Trust Code governing modification or termination of
noncharitable irrevocable trusts by consent to specify
application of the RAP would not be presumed to constitute a
material purpose of the trust, [Note: Under current law,
noncharitable irrevocable trusts may be terminated or
modified upon consent of all of the qualified beneficiaries if
the court concludes that termination or modification is not
inconsistent with a material purpose of the trust.]
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*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org Exclusion from the Statutory RAP
The bill would amend law in the Uniform Statutory RAP
governing exclusions to the RAP to add an exclusion for
trusts created or amended by will, inter vivos agreement, or
exercise of power of appointment on or after July 1, 2023,
that meet the following criteria:
●The governing instrument has specified the RAP
does not apply; and
●The trustee or other person to whom proper power
has been granted or delegated has power to sell,
lease, or mortgage property for a period of time
beyond the period that would otherwise be required
for an interest created under the governing
instrument to vest.
Kansas Income Tax Act Definitions
The bill would expand the definition of “resident trust” in
the Kansas Income Tax Act to include the requirement that
such resident trust has at least one income beneficiary who
was a resident of the state on the last day of the taxable year.
Background
The bill was introduced by the House Committee on
Judiciary at the request of a representative of the Kansas
Judicial Council.
House Committee on Judiciary
In the House Committee hearing on February 1, 2023, a
representative of Midwest Trust testified as a proponent of
the bill, stating the protections afforded by the rule against
perpetuities are not as strong as they were historically, and
that allowing trustors to choose whether the rule will apply
2- 2144 allows more flexibility for Kansas trust companies to
administer these types of trusts and compete with other
states in the market. A representative of the Kansas Bankers
Association provided written-only proponent testimony.
A representative of the Kansas Judicial Council provided
written-only neutral testimony. No other testimony was
provided.
Fiscal Information
According to the fiscal note prepared by the Division of
the Budget on the bill, the Office of Judicial Administration
indicates enactment of the bill would have a negligible fiscal
effect on the operations of the Judicial Branch, and the
Department of Revenue states enactment would have no
fiscal effect on State General Fund receipts.
Kansas Judicial Council; rule against perpetuities; noncharitable irrevocable trust;
resident trust
3- 2144