Title 55, FIDUCIARIES AND TRUSTS

Conversion to a total return unitrust under the provisions of this chapter does not affect any other provisions of the governing instrument, if any, regarding distributions of principal or the standards for distributions of income. Source: SL 2002, ch 225 , § 10; SL 2023, ch 161 …

In the case of a trust for which a marital deduction has been taken for federal tax purpose under I.R.C. section 2056 or 2523, the spouse otherwise entitled to receive the net income of the trust has the right, by written instrument delivered to the trustee, to compel the reconve…

This chapter shall be construed as pertaining to the administration of a trust and shall be available to any trust that is administered in South Dakota under South Dakota law unless (i) the governing instrument reflects an intention that the current beneficiary or beneficiaries a…

Any trustee or disinterested person who in good faith takes or fails to take any action under this chapter is not liable to any person affected by such action or inaction, regardless of whether such person received written notice as provided in this chapter and regardless of whet…

Nothing in this chapter is intended to create or imply a duty to take any action under this chapter, and no trustee is liable for not considering whether to take any action or for choosing not to take any such action. Source: SL 2002, ch 225 , § 14.

This chapter does not apply to a charitable remainder unitrust as defined by § 664(d) of the Internal Revenue Code of 1986 (26 U.S.C. § 664), as of January 1, 2009. Source: SL 2009, ch 252 , § 38.

A trustee, other than an interested trustee, or, if two or more persons are acting as trustee, a majority of the trustees who are not an interested trustee (in either case hereafter "trustee"), may, in its sole discretion and without the approval of any court, (i) convert an inco…

If there is no trustee of the trust other than an interested trustee, the interested trustee or, if two or more persons are acting as trustee and are interested trustees, a majority of such interested trustees, may, in its sole discretion and without the approval of any court, ta…

If any trustee desires to (i) convert an income trust to a total return unitrust, (ii) reconvert a total return unitrust to an income trust, or (iii) change the percentage used to calculate the unitrust amount and the method used to determine the fair market value of the trust bu…

The fair market value of the trust shall be determined at least annually, using such valuation date or dates or averages of valuation dates as are deemed appropriate. Assets for which a fair market value cannot be readily ascertained shall be valued using such valuation methods a…

The unitrust amount shall be determined as follows: (1) For the first three accounting periods of the trust, the unitrust amount for a current valuation year of the trust may not be less than three percent, nor more than five percent, by the election of the trustee, the disintere…

Following the conversion of an income trust to a total return unitrust, the trustee: (1) Shall treat the unitrust amount as the net income of the trust for purposes of determining the amount available, from time to time, for distributions from the trust; and (2) May allocate to t…

In administering a total return unitrust, the trustee may, in its sole discretion but subject to the provisions of the governing instrument, determine: (1) The effective date of the conversion; (2) The timing of distributions during the year, if any, including provisions for pror…

Terms used in this chapter mean: (1) "Claim," a right to payment, whether or not the right is reduced to judgment liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured; (2) "Creditor," with respect to a tran…

A cause of action or claim for relief with respect to a fraudulent transfer of a settlor's assets under § 55-16-9 is extinguished unless the action under § 55-16-9 is brought by a creditor of the settlor who: (1) Is a creditor of the settlor before the settlor's assets are transf…

A qualified disposition that is made by means of a disposition by a transferor who is a trustee is deemed to have been made as of the time, whether before, on, or after July 1, 2005, the property that is the subject of the qualified disposition was originally transferred to the t…

Notwithstanding any law to the contrary, a creditor, including a creditor whose claim arose before or after a qualified disposition, or any other person has only such rights with respect to a qualified disposition as are provided in §§ 55-16-9 to 55-16-16 , inclusive, and no such…

Notwithstanding any other provision of law, no action of any kind, including an action to enforce a judgment entered by a court or other body having adjudicative authority, may be brought at law or in equity against the trustee, or advisor described in § 55-16-4 , of a trust that…

If more than one qualified disposition is made by means of the same trust instrument: (1) The making of a subsequent qualified disposition shall be disregarded in determining whether a creditor's claim with respect to a prior qualified disposition is extinguished as provided in §…

(1) Notwithstanding the provisions of §§ 55-16-9 to 55-16-14 , inclusive, but subject to subdivision (2) of this section, this chapter does not apply in any respect to any person to whom at the time of transfer the transferor is indebted on account of an agreement or order of cou…

A qualified disposition is avoided only to the extent necessary to satisfy the transferor's debt to the creditor at whose instance the disposition had been avoided, together with such costs, including attorney's fees, as the court may allow. If any qualified disposition is avoide…

For the purposes of this chapter, a trust instrument, is an instrument appointing a qualified person or qualified persons for the property that is the subject of a disposition, which instrument: (1) Expressly incorporates the law of this state to govern the validity, construction…

For the purposes of this chapter, a qualified person is any person who qualifies as a qualified person under § 55-3-41 and who meets all the requirements of § 55-3-39 other than the transferor. Source: SL 2005, ch 261 , § 3; SL 2009, ch 252 , § 42.

Neither the transferor nor any other natural person who is a nonresident of this state nor an entity that is not authorized by the law of this state to act as a trustee or whose activities are not subject to supervision as provided in § 55-16-3 may be considered a qualified perso…

Any person may serve as an investment trust advisor, as defined in subdivision 55-1B-1 (6), notwithstanding that the person is the transferor of the qualified disposition, but a transferor may not otherwise serve as a fiduciary under a trust instrument except as stated in subdivi…

If a qualified person of a trust ceases to meet the requirements of § 55-16-3 , and there remains no trustee that meets such requirements, such qualified person shall be deemed to have resigned as of the time of such cessation, and thereupon the successor qualified person provide…

In the case of a disposition to more than one trustee, a disposition that is otherwise a qualified disposition may not be treated as other than a qualified disposition solely because not all of the trustees are qualified persons. Source: SL 2005, ch 261 , § 7.

A qualified disposition is subject to §§ 55-16-9 to 55-16-14 , inclusive, notwithstanding a transferor's retention of any or all of the powers and rights described in subdivision 55-16-2(2) and the transferor's service as trust advisor pursuant to § 55-16-5 . The transferor has o…

Notwithstanding any other provision of law, including chapter 54-8A , no action of any kind, including an action to enforce a judgment entered by a court or other body having adjudicative authority, may be brought at law or in equity for an attachment or other provisional remedy …

An arrangement is a South Dakota special spousal trust if one or both spouses in a marriage transfer property to a trust, the trust expressly declares that some or all the property transferred is South Dakota special spousal property as provided in this chapter, and at least one …

Notwithstanding anything contained in § 55-17-9 to the contrary, a South Dakota special spousal trust may not adversely affect the right of a child to support. Source: SL 2016, ch 231 , § 38.

Notwithstanding anything contained in § 55-17-9 to the contrary: (1) A provision of a revocable South Dakota special spousal property trust does not adversely affect the interest of a creditor unless the creditor has actual knowledge of the trust when the obligation to the credit…

Notwithstanding anything contained in § 55-17-9 to the contrary: (1) Notice of the existence of a South Dakota special spousal property trust, a marriage, or the termination of a marriage does not affect the status of a purchaser as a bona fide purchaser; (2) Special spousal prop…

For purposes of § 55-17-12 , the term, bona fide purchaser, means a purchaser of property for value who has not knowingly been a party to fraud or illegality affecting the interest of the spouses or other parties to the transaction, does not have notice of an adverse claim by a s…

A South Dakota special spousal trust executed during marriage is not enforceable if the spouse against whom enforcement is sought proves that: (1) The trust was unconscionable when made; (2) The spouse against whom enforcement is sought did not execute the South Dakota special sp…

A South Dakota special spousal trust shall contain the following language in capital letters at the beginning of the trust: THE CONSEQUENCES OF THIS TRUST MAY BE VERY EXTENSIVE, INCLUDING YOUR RIGHTS WITH RESPECT TO CREDITORS AND OTHER THIRD PARTIES, AND YOUR RIGHTS WITH YOUR SPO…

Spouses may classify all or any of their property as special spousal property by transferring property to a South Dakota special spousal trust established pursuant to this chapter, and by expressly declaring in the trust that the property is community property. Unless there is a …

A South Dakota special spousal trust may not be amended or revoked unless the trust agreement provides for amendment or revocation, or unless the trust agreement is amended or revoked by a later South Dakota special spousal trust. To amend or revoke the trust, the later South Dak…

For purposes of the application of 26 U.S.C. § 1014(b)(6) (January 1, 2026), a South Dakota special spousal trust is a trust established under the community property laws of this state, as set forth in this chapter. For purposes of this chapter, "special spousal property" means c…

A transfer to a South Dakota special spousal trust may also be a qualified disposition in trust if the transfer complies with the provisions of chapter 55-16 . Source: SL 2016, ch 231 , § 34.

In addition to other transfers of property to a South Dakota special spousal trust, property is considered transferred to a South Dakota special spousal trust if the property is subject to a nonprobate transfer on death under an insurance policy, contract of employment, bond, mor…

The trustee of a South Dakota special spousal trust shall maintain records that identify which property held by the trust is South Dakota special spousal property and which property held by the trust is not South Dakota special spousal property. Source: SL 2016, ch 231 , § 36.

Except as provided in §§ 55-17-10 and 55-17-11 , in a South Dakota special spousal trust, spouses may agree on: (1) The rights and obligations in the property transferred to the trust, notwithstanding when and where the property is acquired or located; (2) The management and cont…

Terms used in this chapter mean: (1) "Bind" or "bound," to consent, receive notice or service of process, approve, agree, object, resist, waive, or demand for or as a person with the same binding and conclusive effect as if the person represented had; (2) "Conflict of interest," …

In a judicial proceeding, the petitioner shall set forth information with respect to each representative, each person the representative represents, and the authority by which each representative acts under this chapter. In a nonjudicial proceeding, the notifier shall set forth i…

Any representative may decline to act as a representative as to the matter in question by timely expressing the representative's refusal to the notifier. A notifier may specify a time of not less than three days in which the representative may decline to act as a representative. …