HOUSE AMENDED
PRIOR PRINTER'S NOS. 1501, 1826, 1946, PRINTER'S NO. 2305
2258, 2285
No. 1205 Session of 1997
INTRODUCED BY GREENLEAF AND BELL, NOVEMBER 24, 1997
AS AMENDED ON THIRD CONSIDERATION, HOUSE OF REPRESENTATIVES,
NOVEMBER 23, 1998
AN ACT
1 Amending Title TITLES 15 (CORPORATIONS AND UNINCORPORATED <--
2 ASSOCIATIONS) AND 20 (Decedents, Estates and Fiduciaries) of
3 the Pennsylvania Consolidated Statutes, FURTHER PROVIDING FOR <--
4 INVESTMENT OF TRUST FUNDS, FOR TRANSFER OF TRUST OR OTHER
5 ASSETS TO INSTITUTIONAL TRUSTEE AND FOR ESTABLISHMENT OR USE
6 OF COMMON TRUST FUNDS AUTHORIZED; imposing limits on the
7 exercise of certain trustee powers and the ability of
8 beneficiaries to appoint trustees under certain
9 circumstances; and further providing for persons who may <--
10 execute anatomical gifts. CIRCUMSTANCES; AND MAKING EDITORIAL <--
11 CHANGES.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. Title 20 of the Pennsylvania Consolidated <--
15 Statutes is amended by adding a chapter to read:
16 SECTION 1. SECTIONS 5548(B), (C) AND (E), 5549(C) AND <--
17 5585(A) OF TITLE 15 OF THE PENNSYLVANIA CONSOLIDATED STATUTES
18 ARE AMENDED TO READ:
19 § 5548. INVESTMENT OF TRUST FUNDS.
20 * * *
1 (B) USE AND MANAGEMENT.--EXCEPT AS OTHERWISE PERMITTED UNDER
2 [THE ESTATES ACT OF 1947] 20 PA.C.S. CH. 61 (RELATING TO
3 ESTATES), THE BOARD OF DIRECTORS OR OTHER BODY SHALL APPLY ALL
4 ASSETS THUS RECEIVED TO THE PURPOSES SPECIFIED IN THE TRUST
5 INSTRUMENT. THE DIRECTORS OR OTHER BODY SHALL KEEP ACCURATE
6 ACCOUNTS OF ALL TRUST FUNDS, SEPARATE AND APART FROM THE
7 ACCOUNTS OF OTHER ASSETS OF THE CORPORATION.
8 (C) DETERMINATION OF INCOME.--
9 [(1) WITH RESPECT TO ANY ASSETS THUS RECEIVED (INCLUDING
10 ANY PARTICIPATION IN ANY COMMON TRUST FUND) SO MUCH OF THE
11 NET REALIZED CAPITAL GAINS AS OF THE END OF ANY FISCAL YEAR
12 OF THE CORPORATION AS THE DIRECTORS OR OTHER BODY SHALL,
13 WITHIN FOUR MONTHS AFTER THE END OF SUCH YEAR, IN THEIR SOLE
14 DISCRETION, ALLOCATE TO INCOME FOR SUCH FISCAL YEAR SHALL BE
15 DEEMED INCOME.
16 (2) THE AMOUNT ALLOCATED UNDER PARAGRAPH (1) OF THIS
17 SUBSECTION, WHEN ADDED TO ALL OTHER INCOME DERIVED BY THE
18 CORPORATION FROM THE SAME ASSETS OR PARTICIPATION IN A COMMON
19 TRUST FUND FOR SUCH FISCAL YEAR, SHALL NOT EXCEED 9% OF THE
20 MARKET VALUE (AS OF THE END OF SUCH FISCAL YEAR) OF THE
21 PRINCIPAL REMAINING WITH RESPECT TO SUCH ASSETS OR
22 PARTICIPATION AFTER ALLOCATION OF SUCH GAIN TO INCOME.
23 (3) ALLOCATION TO INCOME OF REALIZED CAPITAL GAINS IN A
24 COMMON TRUST FUND MAY BE MADE IN ACCORDANCE WITH THE
25 PROVISIONS OF PARAGRAPHS (1) AND (2) OF THIS SUBSECTION
26 WITHOUT REGARD TO WHETHER THE CAPITAL GAINS IN QUESTION WERE
27 REALIZED BEFORE OR AFTER ANY PARTICULAR TRUST OR FUND BECAME
28 A PART OF SUCH COMMON TRUST FUND AND WITHOUT REGARD TO
29 WHETHER THE SEPARATE RECORDS MAINTAINED WITH RESPECT TO SUCH
30 PARTICULAR TRUST OR FUND REFLECT THE EXISTENCE OF A CAPITAL
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1 GAIN IN SUCH TRUST OR FUND.]
2 (1) UNLESS OTHERWISE SPECIFICALLY DIRECTED IN THE TRUST
3 INSTRUMENT, THE BOARD OF DIRECTORS OR OTHER BODY MAY ELECT TO
4 BE GOVERNED BY THIS SUBSECTION WITH RESPECT TO ASSETS THUS
5 RECEIVED, INCLUDING ANY PARTICIPATION IN ANY COMMON TRUST
6 FUND.
7 (2) TO MAKE AN ELECTION UNDER THIS SUBSECTION, THE BOARD
8 OF DIRECTORS OR OTHER BODY SHALL ADOPT AND FOLLOW AN
9 INVESTMENT POLICY SEEKING A TOTAL RETURN FOR THE ASSETS HELD
10 BY THE CORPORATION, OR IN THE NAME OF A NOMINEE OF THE
11 CORPORATION OR BY AN INSTITUTIONAL TRUSTEE PURSUANT TO
12 SECTION 5549 (RELATING TO TRANSFER OF TRUST OR OTHER ASSETS
13 TO INSTITUTIONAL TRUSTEE), WHETHER THE RETURN IS TO BE
14 DERIVED FROM CAPITAL APPRECIATION, EARNINGS OR DISTRIBUTIONS
15 WITH RESPECT TO THE CAPITAL, OR BOTH. THE POLICY CONSTITUTING
16 THE ELECTION SHALL BE IN WRITING, SHALL BE MAINTAINED AS PART
17 OF THE PERMANENT RECORDS OF THE CORPORATION AND SHALL RECITE
18 THAT IT CONSTITUTES AN ELECTION TO BE GOVERNED BY THIS
19 SUBSECTION.
20 (3) IF AN ELECTION IS MADE TO BE GOVERNED BY THIS
21 SUBSECTION, THE TERM "INCOME" SHALL MEAN A PERCENTAGE OF THE
22 VALUE OF THE ASSETS SO HELD BY OR FOR THE CORPORATION. THE
23 BOARD OF DIRECTORS OR OTHER BODY SHALL IN A WRITING
24 MAINTAINED AS PART OF THE PERMANENT RECORDS OF THE
25 CORPORATION ANNUALLY SELECT A PERCENTAGE AND DETERMINE THAT
26 IT IS CONSISTENT WITH THE LONG-TERM PRESERVATION OF THE REAL
27 VALUE OF THE ASSETS, BUT IN NO EVENT SHALL THE PERCENTAGE BE
28 LESS THAN 2% NOR MORE THAN 7% PER YEAR.
29 (4) THE BOARD OF DIRECTORS OR OTHER BODY MAY REVOKE AN
30 ELECTION TO BE GOVERNED BY THIS SUBSECTION IF THE REVOCATION
19970S1205B2305 - 3 -
1 IS MADE AS PART OF AN ALTERNATIVE INVESTMENT POLICY SEEKING
2 THE LONG-TERM PRESERVATION OF THE REAL VALUE OF THE ASSETS
3 THUS RECEIVED. THE REVOCATION AND ALTERNATIVE INVESTMENT
4 POLICY SHALL BE IN WRITING AND MAINTAINED AS PART OF THE
5 PERMANENT RECORDS OF THE CORPORATION.
6 (5) FOR PURPOSES OF APPLYING THIS SUBSECTION, THE VALUE
7 OF THE ASSETS OF THE CORPORATION SHALL BE THE FAIR MARKET
8 VALUE OF THE ASSETS SO HELD BY OR FOR THE CORPORATION,
9 DETERMINED AT LEAST ANNUALLY AND AVERAGED OVER A PERIOD OF
10 THREE OR MORE PRECEDING YEARS. HOWEVER, IF THE ASSETS HAVE
11 BEEN HELD FOR LESS THAN THREE YEARS, THE AVERAGE SHALL BE
12 DETERMINED OVER THE PERIOD DURING WHICH THE ASSETS HAVE BEEN
13 HELD.
14 * * *
15 [(E) DEFINITION.--AS USED IN SUBSECTION (C) OF THIS SECTION
16 "NET REALIZED CAPITAL GAINS AS OF THE END OF ANY FISCAL YEAR"
17 MEANS THE BALANCE ACCUMULATED AS OF SUCH DATE, SINCE THE
18 INCEPTION OF THE TRUST OR FUND OR COMMON TRUST FUND, AS THE CASE
19 MAY BE, OF ALL REALIZED GAINS LESS REALIZED LOSSES, COMPUTED IN
20 THE MANNER PROVIDED IN SECTIONS 1001 ET SEQ. OF THE INTERNAL
21 REVENUE CODE OF 1954 ON THE BASIS OF ACTUAL COST, OR IN THE CASE
22 OF PROPERTY TRANSFERRED TO THE FUND OR TRUST, ON THE BASIS OF
23 FAIR MARKET VALUE ON THE DATE OF TRANSFER.]
24 § 5549. TRANSFER OF TRUST OR OTHER ASSETS TO INSTITUTIONAL
25 TRUSTEE.
26 * * *
27 (C) AMOUNT AND FREQUENCY OF PAYMENT.--SUCH CORPORATE TRUSTEE
28 SHALL PAY, AT LEAST SEMI-ANNUALLY OR AT MORE FREQUENT INTERVALS
29 IF SO AGREED, THE NET INCOME FROM SUCH ASSETS, WHICH INCOME MAY
30 [INCLUDE SO MUCH OF THE REALIZED APPRECIATION OF PRINCIPAL AS
19970S1205B2305 - 4 -
1 THE BOARD OF DIRECTORS OR OTHER BODY OF THE CORPORATION MAY DEEM
2 PRUDENT] BE DETERMINED UNDER SECTION 5548(C) (RELATING TO
3 INVESTMENT OF TRUST FUNDS) IF SUCH ELECTION IS PROPERLY MADE BY
4 THE BOARD OF DIRECTORS OR OTHER BODY OF THE CORPORATION, TO THE
5 CORPORATION FOR USE AND APPLICATION TO THE PURPOSE OR PURPOSES
6 FOR WHICH THE ASSETS WERE RECEIVED BY THE CORPORATION.
7 § 5585. ESTABLISHMENT OR USE OF COMMON TRUST FUNDS AUTHORIZED.
8 (A) GENERAL RULE.--EVERY NONPROFIT CORPORATION MAY ESTABLISH
9 AND MAINTAIN ONE OR MORE COMMON TRUST FUNDS, THE ASSETS OF WHICH
10 SHALL BE HELD, INVESTED AND REINVESTED BY THE CORPORATION ITSELF
11 OR BY A CORPORATE TRUSTEE TO WHICH THE ASSETS HAVE BEEN
12 TRANSFERRED PURSUANT TO SECTION 5549 (RELATING TO TRANSFER OF
13 TRUST OR OTHER ASSETS TO INSTITUTIONAL TRUSTEE). UPON THE
14 PAYMENT BY THE CORPORATE TRUSTEE TO THE NONPROFIT CORPORATION OF
15 THE NET INCOME FROM SUCH ASSETS, WHICH INCOME MAY BE DETERMINED
16 UNDER SECTION 5548(C) (RELATING TO INVESTMENT OF TRUST FUNDS) IF
17 SUCH ELECTION IS PROPERLY MADE BY THE BOARD OF DIRECTORS OR
18 OTHER BODY OF THE CORPORATION, FOR USE AND APPLICATION TO THE
19 SEVERAL PARTICIPATING INTERESTS IN SUCH COMMON TRUST FUND, THE
20 PROPORTIONATE PARTICIPATION OF EACH INTEREST IN SUCH NET INCOME
21 SHALL BE DESIGNATED BY THE CORPORATE TRUSTEE. THE NONPROFIT
22 CORPORATION MAY, AT ANY TIME, WITHDRAW THE WHOLE OR PART OF ANY
23 PARTICIPATING INTEREST IN SUCH COMMON TRUST FUND FOR
24 DISTRIBUTION BY IT AS PROVIDED IN THIS SUBCHAPTER.
25 * * *
26 SECTION 2. TITLE 20 IS AMENDED BY ADDING A CHAPTER TO READ:
27 CHAPTER 75
28 LIMITATIONS ON EXERCISE OF TRUSTEE POWERS
29 AND POWERS OF BENEFICIARIES TO APPOINT TRUSTEES
30 Sec.
19970S1205B2305 - 5 -
1 7501. Legislative intent.
2 7502. Definitions.
3 7503. Application of chapter.
4 7504. Certain trustee powers not exercisable.
5 7505. Joint powers and appointment of nondisqualified
6 substituted trustees.
7 7506. Certain powers of beneficiaries not exercisable.
8 § 7501. Legislative intent.
9 This chapter is enacted to codify, clarify and confirm
10 certain existing common law principles of fiduciary and trust
11 law relating to conflicts of interest on the part of trustees.
12 § 7502. Definitions.
13 The following words and phrases when used in this chapter
14 shall have the meanings given to them in this section unless the
15 context clearly indicates otherwise:
16 "Interested party." Each trustee then serving and each
17 person having an interest in income or principal whom it would
18 be necessary to join as a party in a proceeding for the judicial
19 settlement of a trustee's account. The term "interested party"
20 does not include a person who has not attained majority or is
21 otherwise incapacitated, unless a court has appointed a guardian
22 for the person for some purpose other than acting under section
23 7503 (relating to application of chapter) or an agent has been
24 appointed under a durable power of attorney that is sufficient
25 to grant authority to act under section 7503.
26 § 7503. Application of chapter.
27 (a) General rule.--This chapter shall apply to:
28 (1) Any trust created under a governing instrument
29 executed on or after (the Legislative Reference Bureau shall
30 insert here the date that is 90 days after the effective date
19970S1205B2305 - 6 -
1 of this act), unless the governing instrument expressly
2 provides that this chapter does not apply.
3 (2) Any trust created under a governing instrument
4 executed before (the Legislative Reference Bureau shall
5 insert here the date that is 90 days after the effective date
6 of this act), unless all interested parties affirmatively
7 elect on or before (the Legislative Reference Bureau shall
8 insert here the date that is the third anniversary of the
9 effective date of this act) by a written declaration signed
10 by or on behalf of each interested party and delivered to the
11 trustee, not to be subject to the application of this
12 chapter. In the case of a testamentary trust, the
13 declarations shall be filed with the register in the county
14 in which the will was admitted to probate.
15 (b) Exclusion.--This chapter shall not apply to:
16 (1) Any trust during the time that the trust is
17 revocable or amendable by its settlor.
18 (2) A spouse of a decedent or settlor where the spouse
19 is the trustee of a testamentary or inter vivos trust for
20 which a marital deduction has been allowed.
21 (3) A trustee who possesses in his individual capacity
22 an unlimited right to withdraw the entire principal of the
23 trust or has a general testamentary power of appointment over
24 the entire principal of the trust.
25 (4) A trust under a governing instrument that by
26 specific reference expressly rejects the application of this
27 chapter.
28 (5) A trust created under a governing instrument
29 executed on or before (the Legislative Reference Bureau shall
30 insert here the date that is 90 days after the effective date
19970S1205B2305 - 7 -
1 of this act) if no part of the principal of the trust would
2 be included in the gross estate of the trustee for Federal
3 estate tax purposes if the trustee had died on (the
4 Legislative Reference Bureau shall insert here the date that
5 is 90 days after the effective date of this act) without
6 having exercised the power under the governing instrument to
7 make discretionary distributions of principal or income to or
8 for the benefit of the trustee, the trustee's estate or the
9 creditors of either.
10 § 7504. Certain trustee powers not exercisable.
11 (a) General rule.--The following powers conferred by a
12 governing instrument upon a trustee in his or her capacity as a
13 trustee shall not be exercised by that trustee:
14 (1) The power to make discretionary distributions of
15 either principal or income to or for the benefit of the
16 trustee, the trustee's estate or the creditors of either,
17 unless the power is either:
18 (i) limited by an ascertainable standard relating to
19 the trustee's health, education, support or maintenance
20 within the meaning of 26 U.S.C. §§ 2041 (relating to
21 powers of appointment) and 2514 (relating to powers of
22 appointment); or
23 (ii) exercisable by the trustee only in conjunction
24 with another person having a substantial interest in the
25 property subject to the power which is adverse to the
26 interest of the trustee within the meaning of 26 U.S.C. §
27 2041(b)(1)(C)(ii).
28 (2) The power to make discretionary distributions of
29 either principal or income to satisfy any of the trustee's
30 personal legal obligations for support or other purposes.
19970S1205B2305 - 8 -
1 (3) The power to make discretionary allocations in the
2 trustee's personal favor of receipts or expenses as between
3 income and principal, unless the trustee has no power to
4 enlarge or shift any beneficial interest except as an
5 incidental consequence of the discharge of the trustee's
6 fiduciary duties.
7 (4) The power to exercise any of the powers proscribed
8 in this subsection with regard to an individual other than
9 the trustee to the extent that the individual could exercise
10 a similar prohibited power in connection with a trust that
11 benefits the trustee.
12 (b) Limited exercise of prohibited power.--
13 (1) If a trustee is prohibited by subsection (a)(1) from
14 exercising a power conferred upon the trustee, the trustee
15 nevertheless may exercise that power but shall be limited to
16 distributions for the trustee's health, education, support or
17 maintenance to the extent otherwise permitted by the terms of
18 the trust.
19 (2) Unless otherwise prohibited by the provisions of
20 this section, a trustee may exercise a power described herein
21 in favor of someone other than the trustee, the trustee's
22 estate or the creditors of either.
23 § 7505. Joint powers and appointment of nondisqualified
24 substituted trustees.
25 If a governing instrument contains a power proscribed under
26 section 7504 (relating to certain trustee powers not
27 exercisable), the following shall apply:
28 (1) If the power is conferred on two or more trustees,
29 it may be exercised by the trustee or trustees who are not so
30 prohibited as if they were the only trustee or trustees.
19970S1205B2305 - 9 -
1 (2) If there is no trustee in office who can exercise
2 the power as provided in paragraph (1), the court, upon
3 petition and hearing after such notice as it may direct,
4 shall appoint a trustee who is not disqualified and whose
5 term in office shall be as the court directs for the sole
6 purpose of exercising the powers that the other trustees
7 cannot exercise.
8 § 7506. Certain powers of beneficiaries not exercisable.
9 (a) General rule.--No beneficiary of a trust in an
10 individual, trustee or other capacity, may appoint or remove and
11 appoint a trustee who is related or subordinate to the
12 beneficiary within the meaning of 26 U.S.C. § 672(c) (relating
13 to definitions and rules) unless:
14 (1) the trustee's discretionary power to make
15 distributions to or for the beneficiary is limited by an
16 ascertainable standard relating to the beneficiary's health,
17 education, support or maintenance within the meaning of 26
18 U.S.C. §§ 2041 (relating to powers of appointment) and 2514
19 (relating to powers of appointment);
20 (2) the trustee's discretionary power may not be
21 exercised to satisfy any of the beneficiary's legal
22 obligations for support or other purposes; and
23 (3) the trustee's discretionary power may not be
24 exercised to grant to the beneficiary a general power to
25 appoint property of the trust to the beneficiary, the
26 beneficiary's estate or the creditors thereof within the
27 meaning of 26 U.S.C. § 2041.
28 (b) Exception.--This section shall not apply if the
29 appointment of the trustee by the beneficiary may be made only
30 in conjunction with another person having a substantial interest
19970S1205B2305 - 10 -
1 in the property of the trust, subject to the power, which is
2 adverse to the exercise of the power in favor of the beneficiary
3 within the meaning of 26 U.S.C. § 2041(b)(1)(C)(ii), or the
4 appointment is in conformity with a procedure governing
5 appointments approved by the court before (the Legislative
6 Reference Bureau shall insert there the effective date of this
7 act).
8 Section 2. Section 8611(a) of Title 20 is amended to read: <--
9 § 8611. Persons who may execute anatomical gift.
10 (a) General rule.--Any individual of sound mind and 18 years
11 of age or more may give all or any part of his body for any
12 purpose specified in section 8612 (relating to persons who may
13 become donees; purposes for which anatomical gifts may be made),
14 the gift to take effect upon death. Any individual who is a
15 minor and 16 years or age or older may effectuate a gift for any
16 purpose specified in section 8612, provided parental or guardian
17 consent is deemed given. Parental or guardian consent shall be
18 noted on the minor's donor card, application for the donor's
19 learner's permit or driver's license or other document of gift.
20 A gift of the whole body shall be invalid unless made in writing
21 at least 15 days prior to the date of death[.] or consent is
22 obtained from the legal next of kin. Where there are adult
23 children of the deceased who are not children of the surviving
24 spouse, their consent shall also be required for a gift of the
25 whole body for anatomical study.
26 * * *
27 SECTION 3. TITLE 20 IS AMENDED BY ADDING A SECTION TO READ: <--
28 § 8113. CHARITABLE TRUSTS.
29 (A) ELECTION.--NOTWITHSTANDING THE FOREGOING PROVISIONS OF
30 THIS CHAPTER, THE TRUSTEE OF A TRUST HELD EXCLUSIVELY FOR
19970S1205B2305 - 11 -
1 CHARITABLE PURPOSES MAY ELECT TO BE GOVERNED BY THIS SECTION
2 UNLESS THE GOVERNING INSTRUMENT EXPRESSLY PROVIDES TO THE <--
3 CONTRARY THAT THE ELECTION PROVIDED BY THIS SECTION SHALL NOT BE <--
4 AVAILABLE.
5 (B) ELIGIBILITY FOR ELECTION.--TO MAKE AN ELECTION UNDER
6 THIS SECTION, THE TRUSTEE SHALL ADOPT AND FOLLOW AN INVESTMENT
7 POLICY SEEKING A TOTAL RETURN FOR THE INVESTMENTS HELD BY THE
8 TRUST, WHETHER THE RETURN IS TO BE DERIVED FROM APPRECIATION OF
9 CAPITAL OR EARNINGS AND DISTRIBUTIONS WITH RESPECT TO CAPITAL,
10 OR BOTH. THE POLICY CONSTITUTING THE ELECTION SHALL BE IN
11 WRITING, SHALL BE MAINTAINED AS PART OF THE PERMANENT RECORDS OF
12 THE TRUST AND SHALL RECITE THAT IT CONSTITUTES AN ELECTION TO BE
13 GOVERNED BY THIS SECTION.
14 (C) EFFECT OF ELECTION.--IF AN ELECTION IS MADE TO BE
15 GOVERNED BY THIS SECTION, THE TERM "INCOME" SHALL MEAN A
16 PERCENTAGE OF THE VALUE OF THE TRUST. THE TRUSTEE SHALL IN A
17 WRITING MAINTAINED AS PART OF THE PERMANENT RECORDS OF THE TRUST
18 ANNUALLY SELECT THE PERCENTAGE AND DETERMINE THAT IT IS
19 CONSISTENT WITH THE LONG-TERM PRESERVATION OF THE REAL VALUE OF
20 THE PRINCIPAL OF THE TRUST, BUT IN NO EVENT SHALL THE PERCENTAGE
21 BE LESS THAN 2% NOR MORE THAN 7% PER YEAR. THE TERM "PRINCIPAL"
22 SHALL MEAN ALL OTHER ASSETS HELD BY THE TRUSTEE WITH RESPECT TO
23 THE TRUST.
24 (D) REVOCATION OF ELECTION.--THE TRUSTEE MAY REVOKE AN
25 ELECTION TO BE GOVERNED BY THIS SECTION IF THE REVOCATION IS
26 MADE AS PART OF AN ALTERNATIVE INVESTMENT POLICY SEEKING THE
27 LONG-TERM PRESERVATION OF THE REAL VALUE OF THE PRINCIPAL OF THE
28 TRUST. THE REVOCATION AND ALTERNATIVE INVESTMENT POLICY SHALL BE
29 IN WRITING AND MAINTAINED AS PART OF THE PERMANENT RECORDS OF
30 THE TRUST.
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1 (E) VALUE DETERMINATION.--FOR PURPOSES OF APPLYING THIS
2 SECTION, THE VALUE OF THE TRUST SHALL BE THE FAIR MARKET VALUE
3 OF THE CASH AND OTHER ASSETS HELD BY THE TRUSTEE WITH RESPECT TO
4 THE TRUST, WHETHER SUCH ASSETS WOULD BE CONSIDERED "INCOME" OR
5 "PRINCIPAL" UNDER THE OTHER PROVISIONS OF THIS CHAPTER,
6 DETERMINED AT LEAST ANNUALLY AND AVERAGED OVER A PERIOD OF THREE
7 OR MORE PRECEDING YEARS. HOWEVER, IF THE TRUST HAS BEEN IN
8 EXISTENCE LESS THAN THREE YEARS, THE AVERAGE SHALL BE DETERMINED
9 OVER THE PERIOD DURING WHICH THE TRUST HAS BEEN IN EXISTENCE.
10 SECTION 4. THE AMENDMENT OR ADDITION OF THE FOLLOWING <--
11 PROVISIONS SHALL APPLY TO ALL TRUSTS, WHETHER CREATED BEFORE, ON
12 OR AFTER THE EFFECTIVE DATE OF THIS ACT:
13 (1) 15 PA.C.S. §§ 5548(B), (C) AND (E), 5549(C) AND
14 5585(A).
15 (2) 20 PA.C.S. § 8113.
16 Section 3 2 4 5. This act shall take effect immediately. <--
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