Bill > HB4033

This bill creates a new Unitrust Act that provides trustees with more flexibility in managing trusts by allowing them to convert between income trusts and unitrusts, and to adjust how trust income is calculated. Specifically, the bill enables trustees to convert a traditional income trust to a unitrust (where income is calculated as a percentage of the trust's total value) or vice versa, and to change the percentage used to calculate the unitrust amount. The bill establishes detailed rules for how trustees can make these changes, requiring them to send notice to beneficiaries and follow specific guidelines. For trusts that qualify for special tax benefits or lack an independent trustee, the bill imposes some restrictions, such as limiting the unitrust rate to between 3% and 5%. The legislation provides comprehensive definitions and procedures for implementing these trust management strategies, including how to value trust assets, determine distribution timing, and handle potential errors in calculations. The act applies to trusts existing or created after its effective date and aims to give trustees more tools to manage trusts in a way that balances the interests of current and future beneficiaries.

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https://legislature.mi.gov/Bills/Bill?ObjectName=2025-HB-4033