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Friday, January 10, 2014

The Delaware Corporate Legislation Tracker - January 10, 2014

What's happening in the Delaware Legislature?

The Delaware Corporate Legislation Tracker is a free service offered by our firm, designed to keep you informed on current and pending legislation related to Delaware Corporate rules, regulations, and Delaware business matters.

Here's the latest edition:





The following Legislation affecting Title 12 - Decedents' Estates and Fiduciary Relations was acted upon by the General Assembly on 1/8/2014:




SB 155
Title:  AN ACT TO AMEND TITLE 12 OF THE DELAWARE CODE RELATING TO FIDUCIARY RELATIONS


Synopsis:
Section 1 of the Act is intended to (i) clarify that a transfer to a trust will not constitute a qualified disposition within the meaning of the Qualified Dispositions in Trust Act if the transferor serves as a trustee of the trust; (ii) revise current law to provide that a transfer to a trust may constitute a qualified disposition within the meaning of the Qualified Dispositions in Trust Act even if the transferor retains a lifetime limited power of appointment (the purpose of this revision of current law is to permit the creation under Delaware law of trusts designed in the manner sanctioned by the Internal Revenue Service in a recent letter ruling holding that contributions to the trust were incomplete gifts and the trust was not a grantor trust); (iii) revise current law to provide that a transfer to a trust may constitute a qualified disposition within the meaning of the Qualified Dispositions in Trust Act even if the transferor retains a lifetime general power of appointment provided that the power may only be exercised to reimburse the transferor for income taxes borne by the transferor attributable to income earned by the trust; (iv) reorganize Section 3570 to clarify that the paragraphs following (8) b. are not part of the definition of a "qualified trustee" but rather expound upon the definition; (v) clarify that a transferor's right to remove and replace trustees and advisers subsumes within it the right to appoint additional trustees and advisers; (vi) correct cross-references and more closely align the statute with the pertinent Treasury Regulations so as to clarify that a transfer of property to a "qualified personal residence trust," as defined by the federal tax laws, may be a "qualified disposition" for purposes of Delaware's asset protection trust legislation; (vii) clarify that the reference to separation and divorce proceedings in Section 3573(1) is intended to refer to judicial proceedings; (viii) revise Subsection (f) of Section 3574 for clarity but not make a substantive change to the statute; and (ix) revise Section 3592 to prevent the possibility that the application of Section 3592 might cause a transfer, intended to constitute a qualified disposition within the meaning of the Qualified Dispositions in Trust Act, to fail to satisfy the statutory requirements for treatment as a qualified disposition.
Section 2 of the Act provides for the effective date of the Act.

Bill History:

Jan 08, 2014 - Assigned to Banking Committee in Senate







SB 156
Title:  AN ACT TO AMEND TITLE 12 OF THE DELAWARE CODE RELATING TO FIDUCIARY RELATIONS


Synopsis:
Section 1 of the Act is intended to (i) clarify existing law regarding the ability of a trustor to provide by the terms of a governing instrument that an adviser (including a protector) is not a fiduciary; and (ii) clarify that the provisions of Section 3303 of Title 12 take precedence over the Section 3316 default rule.
Section 2 of the Act is intended to (i) provide a procedure for waiving certain trust accountings; and (ii) clarify existing law regarding the relationship between Section 3546 and Delaware's virtual representation statute.
Section 3 of the Act provides for the effective date of the Act.
Bill History:

Jan 08, 2014 - Assigned to Banking Committee in Senate






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