456.4-418. Distribution of trust income or principal to qualified remainder beneficiary, when--applicability to irrevocable trust, when.
Distribution of trust income or principal to qualified remainderbeneficiary, when--applicability to irrevocable trust, when.
456.4-418. 1. During any period of time that this section applies toan irrevocable trust, the trustee shall have the authority in itsdiscretion to distribute trust income or principal to a qualified remainderbeneficiary of the trust. For purposes of this section, a "qualifiedremainder beneficiary" is a descendant of a permissible distributee whowill be eligible to receive distributions of trust income or principal,whether mandatory or discretionary, upon the termination of the interest ofsuch permissible distributee or upon the termination of the trust.
2. This section shall apply to an irrevocable trust that isadministered in this state if:
(1) The trustee may distribute trust income or principal to one ormore permissible distributees;
(2) No distributions of trust income or principal have been made toany permissible distributee during the ten-year period preceding the noticerequired by subsection 5 of this section;
(3) The trustee determines that there will be sufficient assets inthe trust for the trustee to meet its obligations to the permissibledistributees after any distributions authorized by this section;
(4) The trustee determines that the application of this section tothe trust is not inconsistent with a material purpose of the trust;
(5) The trustee determines that the application of this section to atrust that is exempt from the federal generation-skipping transfer tax willnot cause the trust to become subject to such tax; and
(6) The trust became irrevocable on or before September 25, 1985.
3. After the trustee determines that this section applies to a trust,this section shall continue to apply to the trust until the first to occurof the following:
(1) The termination of the interests of all the beneficiaries whowere permissible distributees on the date of the notice required bysubsection 5 of this section;
(2) The termination of the trust; or
(3) The trustee determines that additional distributions under thissection will impair the ability of the trustee to meet its obligation tothe permissible distributees.
4. A spendthrift provision in the terms of a trust is not presumedinconsistent with the application of this section to the trust.
5. The trustee shall notify the qualified beneficiaries of the trustthat the trustee has determined that this section applies to a trust notless than sixty days before distributing trust income or principal to anyqualified remainder beneficiary.
6. A trustee acting in good faith shall not be liable to anybeneficiary for acting or failing to act under this section.
(L. 2009 H.B. 239)