Alert November 02, 2012

New Notice Requirements for Existing Trusts Under the Massachusetts Uniform Trust Code

The Massachusetts Uniform Trust  Code (the “MUTC”) was recently signed into law by Governor Deval Patrick and became effective immediately.  It contains provisions that impose new duties on the trustees of existing trusts. In many cases the trust instrument can override or limit these provisions.  In cases where these provisions have not been overridden, the MUTC:

  • Requires trustees to notify qualified beneficiaries within 30 days of a trust becoming irrevocable.
    • “Qualified beneficiaries” includes those currently entitled or eligible to receive distributions of income or principal and those who would be entitled or eligible to receive distributions of income or principal if the trust terminated on the date the notice is provided.
  • Requires trustees to notify qualified beneficiaries of an irrevocable trust within 30 days of the name and address of any new trustee.
  • Requires trustees to notify qualified beneficiaries of an intent to transfer the principal place of the trust administration to a state other than Massachusetts not less than 60 days prior to such transfer and to explain the reasons for the transfer.   
  • Requires trustees to notify qualified beneficiaries of an intent to combine or divide trusts using the powers given to trustees by the MUTC.
  • Unless there is an overriding provision in the trust, trustees must send accounts annually to the beneficiaries currently entitled or eligible to receive distributions of income or principal.  (Note that most trust instruments do include an overriding accounting clause.) 
  • Codifies the Massachusetts common law duty of trustees to keep the trust beneficiaries reasonably informed about the administration of an irrevocable trust and to respond to a beneficiary’s request for information about the trust.
Individuals who have existing revocable trusts who do not want these new provisions to apply should take the opportunity to amend these instruments before they become irrevocable.  If you have established an irrevocable trust or are the trustee or beneficiary of an irrevocable trust, we are available to talk with you about how these provisions impact the administration of the trust.