All Roll Calls
Yes: 132 • No: 0
ArkansasHB17492025 Regular SessionHouse
TO ADOPT THE UNIFORM TRUST DECANTING ACT.
Sponsored By: Tyler Dees (Republican), Matt Brown (Republican)
Enacted
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Bill Overview
Analyzed Economic Effects
13 provisions identified: 4 benefits, 1 costs, 8 mixed.
Animal care trusts keep their purpose
Beginning January 1, 2026, an animal-care trust with a protector can decant as if each benefiting animal were a person. The protector must consent in a signed record and has qualified-beneficiary enforcement rights. The new trust must keep assets dedicated to the intended animal-care purpose for the original trust’s intended care period.
Trust beneficiaries retain pay and removal safeguards
Beginning January 1, 2026, decanting cannot raise manager pay above the original trust’s amount without consent or court approval. If the trust sets no amount, the limit is the pay allowed by Arkansas law. An increase requires signed consent from all qualified beneficiaries of the new trust or court approval. Pay changes incidental to other trust changes do not count as increases. Changing only one person’s power to remove or replace the manager requires that person’s signed consent. Transferring that power requires a substantially similar replacement power and signed consent from the powerholder and qualified beneficiaries, or court approval.
Trust transfers preserve existing tax protections
Beginning January 1, 2026, new trust terms cannot defeat listed tax treatment available to the original trust or its property. Protections cover marital and charitable deductions, gift-tax exclusions, S-corporation eligibility, and qualified subchapter-S trust status. They also cover a zero generation-skipping tax inclusion ratio, specified grantor-trust benefits, and qualified retirement-benefit distribution protections. Other tax benefits are protected when the original trust expressly seeks them or is clearly designed for them, and qualifies. Decanting cannot increase required minimum retirement distributions. An attempted change that increases them places qualified-benefit property and reinvested distributions in a separate share from the exercise date. Federal tax references use the law as it existed on January 1, 2025.
Charitable gifts stay protected during trust changes
Beginning January 1, 2026, the Arkansas Attorney General can represent a defined charitable interest and has qualified-beneficiary rights. New trusts cannot reduce that interest or an identified charity’s interest, change its purpose, or alter related conditions. Multiple new trusts are counted together when checking for a reduction. A new trust with a defined charitable interest must be administered under Arkansas law. Exceptions require no timely Attorney General objection after notice, the Attorney General’s signed consent, or court approval.
Trust transfers do not erase debts
Beginning January 1, 2026, enforceable debts, liabilities, and other obligations remain attached to property moved into a new trust. Creditors can enforce those claims to the same extent as before. Decanting alone does not free the property from those obligations.
Advance notice before trust assets move
Beginning January 1, 2026, trust managers generally must give notice at least 60 days before decanting. Notice explains the change, gives its effective date, and includes the original and all new trust documents. Recipients include living or existing trust creators, qualified beneficiaries, current appointment-power holders, and people who can remove or replace the manager. Other original-trust managers, new-trust managers, and the Attorney General for covered charitable interests also receive notice. Everyone entitled to notice can shorten the waiting period by signing a waiver. Notice is not required for an unrepresented minor beneficiary or someone unknown or unlocatable after reasonable efforts. Authorized representatives can receive notice and give binding consent or waivers unless the represented person objects before they take effect. A trust creator cannot represent a beneficiary; prior court approval generally is unnecessary, but courts can review and remedy decanting.
Broader trust changes with beneficiary protections
Beginning January 1, 2026, managers with broad power to distribute principal can move it into new trusts for current beneficiaries. If that power covers only part of the principal, only that part can move. The new trusts generally cannot add new current beneficiaries, add certain future beneficiaries, or reduce vested interests. Powers to choose who receives trust property can change, including the range of possible recipients. A current beneficiary can receive a new or changed power only when the manager has broad distribution power for that beneficiary. A future beneficiary’s power takes effect only when that person becomes, or would have become if living, a current beneficiary. An existing, presently usable general power to choose recipients cannot be removed.
Limited trust powers preserve beneficiary interests
Beginning January 1, 2026, managers whose distribution power follows a measurable or reasonably clear standard can also decant principal. Across all new trusts, each beneficiary must keep substantially similar rights to trust benefits. Only principal covered by the manager’s distribution power can move. An individual’s distribution can pass through a new trust when used for that person or allowed by both trust documents. Arkansas Trust Code rules also allow this for legal disability or when the trustee reasonably believes the person is incapacitated.
New options for changing Arkansas trusts
Beginning January 1, 2026, authorized trust managers can move assets into new trusts or change an existing trust through “decanting.” This covers express trusts administered in Arkansas or governed by Arkansas law for administration or interpreting their terms. Eligible trusts are irrevocable, or revocable only with a trustee’s consent or consent from someone with an adverse interest. Trusts held solely for charity are excluded. The power is included unless the trust says otherwise; express bans or limits must carry into the new trust. General bans on amendment or revocation, spendthrift clauses, and transfer limits alone do not block decanting. Managers must follow their legal duties and the original trust’s purposes, but need not decant or explain this law to beneficiaries. Decanting does not require an otherwise available principal payout, and the exercise must be documented in a signed record.
New trusts retain key legal ties
Beginning January 1, 2026, a new trust can have a different duration, but transferred assets keep their existing legal time limits. The original creator remains the creator for transferred principal under Arkansas law outside this act. Interpreting intent can also consider the original creator, the new creator, and the manager who made the change. Later-found or later-received assets go to the new trusts after an intended full transfer, but stay behind after a partial transfer. The decanting record or new trust terms can direct a different result. An otherwise valid decanting survives partly invalid terms: prohibited terms are void as needed, and required missing terms count as included. A new-trust manager who discovers that problem must take corrective action consistent with their duties.
Trust managers keep liability limits and protections
Beginning January 1, 2026, new trust terms cannot further reduce a manager’s liability for breach or reduce overall manager liability. The new trust can cover claims or liabilities only to the extent the original trust could have paid them. Reassigning powers or addressing responsibility for another manager’s conduct must also be allowed by other Arkansas law. Managers and others are protected from liability for acts or omissions based on reasonable reliance on a valid trust change. That reliance protection covers changes under this law, other Arkansas law, or another jurisdiction’s law.
Special needs trusts offer benefits with payback
Beginning January 1, 2026, a special-needs manager can use the broad-discretion route to create a trust for a beneficiary with a disability. The manager must find that the change furthers the original trust’s purposes and believe the person may qualify for disability-based benefits. The new trust is intended not to count as an available asset for government-benefit eligibility; eligibility is not guaranteed. The law allows Medicaid pooled trusts or Medicaid-payback terms, including reimbursement requirements under federal law as of January 1, 2025. Other beneficiaries must keep substantially similar interests across the new trusts, except for effects of changing the disabled beneficiary’s interests.
Trust creators can block some tax changes
Beginning January 1, 2026, a new trust can have a different grantor-trust tax status from the original trust. Grantor status generally assigns trust income to its creator for tax purposes. A creator’s signed objection delivered during the notice period blocks specified changes. This includes replacing a grantor trust while dropping an existing power to end grantor status. It also covers changing a nongrantor trust into the creator’s grantor trust unless the creator can always end that status or both documents provide the same power.
Sponsors & Cosponsors
Sponsors
Tyler Dees
Republican • Senate
Matt Brown
Republican • House
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
Senate vote • 4/9/2025
Senate Vote - Wednesday, April 9, 2025 7:54:05 PM
Yes: 33 • No: 0 • Other: 1
House vote • 3/31/2025
House Vote - Monday, March 31, 2025 2:45:14 PM
Yes: 99 • No: 0
Actions Timeline
Notification that HB1749 is now Act 680
4/16/2025HouseCorrectly enrolled and ordered transmitted to the Governor's Office.
4/10/2025HouseTO BE ENROLLED
4/9/2025HouseReturned from the Senate as passed.
4/9/2025HouseReturned to the House as passed.
4/9/2025SenateRead the third time and passed.
4/9/2025SenateReturned by the Committee, with the recommendation that it Do Pass
4/7/2025SenateRead first time, rules suspended, read second time, referred to JUDICIARY COMMITTEE - SENATE
3/31/2025SenateReceived from the House.
3/31/2025SenateRead the third time and passed and ordered transmitted to the Senate.
3/31/2025HouseReturned by the Committee Do Pass
3/20/2025HouseRead the first time, rules suspended, read the second time and referred to the Committee on JUDICIARY COMMITTEE- HOUSE
3/12/2025HouseFiled
3/12/2025House
Bill Text
HB1749 - Introduced
3/12/2025
Act Version
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