Changes in Ohio Probate Law

BILL SUMMARY - Ohio Legislative Service Commission

Probate Law

-Specifies that a will deposited by or for the testator in the office of the judge of the probate court of the county in which the testator lives may be so deposited before or after the testator's death and if after such death, with or without applying for its probate.

-Increases the fee for the deposit of the will from $5 to $25 and specifies that the fee is to be paid to the court.

-Authorizes a probate judge to dispose of a deposited will after 100 years if it is not delivered or disposed as provided in continuing law, and requires the judge to keep an electronic copy of the will prior to such disposal.

-Specifies that a deposited will generally is not a public record until the time an application is filed to probate it.

-Provides that property devised or bequeathed to a beneficiary in a will who knows of the will's existence for one year after the testator's death and, without reasonable cause, intentionally conceals or withholds it or refuses to cause it to be offered for probate passes as if the beneficiary predeceased the testator.

-Provides that a provision in a will or governing instrument apportioning tax to an interest that is otherwise allowable as an estate tax marital or charitable deduction is ineffective unless it refers to such deduction and expressly acknowledges and accepts any resultant partial loss of the deduction.

-Modifies the number of automobiles that may be selected by a surviving spouse upon the other spouse's death from a maximum of two automobiles under current law to "one or more" automobiles.

-Increases the maximum total value of the automobiles that may be selected by the surviving spouse from $40,000 to $65,000.

Uniform Simultaneous Death Act (USDA)

Substantially retains current law that generally provides, for purposes of the probate law or governing instruments, that an individual who is not established by clear and convincing evidence to have survived the other individual or an event by 120 hours is deemed to have predeceased the other individual or event.

Generally provides that if it is not established by clear and convincing evidence that one of two co-owners with right of survivorship survived the other co-owner by 120 hours, one-half of the property passes as if one co-owner survived the other by 120 hours and one-half passes as if the other co-owner survived the one by 120 hours.

Generally provides that if there are more than two co-owners with right of survivorship and it is not established by clear and convincing evidence that at least one of the co-owners survived the others by 120 hours, the property passes in the proportion that one co-owner's ownership bears to all the co-owners' ownership.

Substantially retains, with structural changes, the existing conditions for which survival by 120 hours is not required.

Expands current law specifying the instances in which a payor or other third party is either liable or not liable for a payment made or an item of property or benefit transferred under the USDA.

Provides that the bill does not impair any act done in any proceeding, or any right that accrued, before its effective date.

Intestate succession

Specifies in intestate succession that a person described as living means the person was living at the time of the intestate's death and lived for at least 120 hours after such death, and a person is described as having died if the person died before the intestate or failed to live for at least 120 hours after the intestate's death.

Provides that no descendant of an intestate inherits under the law on descent and distribution unless surviving the intestate for at least 120 hours, or unless born within 300 days after the intestate's death and living for at least 120 hours after birth.

Ohio Trust Code

Provides that the Trust Code requirements for interested parties to enter into private settlement agreements regarding trust matters generally do not apply to agreements amending the governing instrument of charitable remainder trusts that require the approval of the Attorney General under continuing law.

Specifies that an action under the Trust Code is a civil action subject to the Rules of Civil Procedure and is commenced by filing a complaint unless it involves a testamentary or other trust already subject to court supervision.

Authorizes the holder of a limited testamentary power of appointment to also represent persons whose interests as possible appointees are subject to the power, to the extent no conflict of interest exists between the holder and the persons represented with respect to the particular question.

Authorizes an agent under a power of attorney to create a trust for the principal, whether or not the principal has capacity to create the trust and indicates an intention to create the trust, but only as provided in the Uniform Power of Attorney Act.

Uniform Principal and Income Act (UPIA)

Replaces current law with the following rules that generally apply in determining the allocation of a payment from a separate fund to a trust for which an election to qualify for a marital deduction is made or a trust that qualifies for the marital deduction under the Internal Revenue Code (IRC):

      A trustee must allocate a payment from a separate fund to income to the extent of the fund's internal income and       distribute that amount to the surviving spouse, and allocate the balance to principal.

      If the trustee cannot determine the fund's internal income but can determine its value, the internal income is       deemed to equal 4% of its value according to the most recent statement of value preceding the start of the       accounting period.

      If the trustee cannot determine the fund's internal income or its value, the internal income is determined       according to a formula in the IRC on the valuation tables for annuities.

Specifies the applicable dates in which those new rules would apply depending on when or whether a payment has been received from a separate fund in relation to the bill's effective date or January 1 of the year the bill takes effect.

Eliminates the current provision regarding the fiduciary duty of the trustee of a trust that qualifies for an estate tax marital deduction and is the beneficiary of an individual retirement account to withdraw and distribute the income of the account to the settlor's or testator's surviving spouse, and the satisfaction of that duty.

Clarifies current law regarding the source of payment of income taxes paid by a trustee on the trust's share of an entity's taxable income, from income or principal or proportionately from principal and income depending upon the allocation of the receipts from the entity.

Ohio Transfers to Minors Act (OTMA)

Generally permits the delay of the time for delivery to the minor of transferred custodial property until a specified time after the minor becomes 21, which time must be specified in the written instrument that provides for the gift or transfer.

Generally provides that the time for delivery to the minor of custodial property transferred under a will, trust, or irrevocable exercise of a testamentary power of appointment may be delayed only if such instrument provides that the custodianship is until the minor attains a specified age which cannot be later than 25 years.

Except in regard to the transfer of custodial real property, specifically permits a donor, transferor, trustee, executor, or administrator to designate one or more successor custodians.

Permits a custodian to designate one or more successor custodians by transferring the custodial property, other than real estate, to self as custodian, followed by the designation of the successor custodian or custodians.

Provides that the designation by a custodian of a successor custodian of custodial real estate is pursuant to the law on transfer on death of real property.

Expands current law by providing that if no eligible successor custodian is designated under the OTMA as modified by the bill, the legal representative of a Legislative Service Commission -5- Sub. H.B. 432 As Reported by H. Judiciary custodian who is deceased or adjudged to be an incompetent may designate a successor custodian.

Raises the threshold amount from $10,000 to $25,000 for a transfer to be authorized by a court if a trustee, executor, or administrator makes a transfer of property that is in the minor's best interest and is not prohibited by or inconsistent with the applicable governing instrument.

Sale of estate's real property by guardian

Expands current law by providing another method for a guardian to sell the estate's real property in which written consents of the ward's spouse and potential heirs to the sale must be filed with the court, the sale price must be at least 80% of the appraised value, and the guardian must give a bond.

Franklin County guardianship program

Authorizes the Franklin County Probate Court to charge fees for certain services rendered in connection with the establishment and management of adult guardianships.

Eliminates the authority of the Franklin County Probate Court to appoint the members and director of the Franklin County Guardianship Service Board as guardians and authorizes the Court to appoint the Board itself as guardian.

Permits the director or designee of the Franklin County Guardianship Service Board to act on behalf of the Board on all guardianship matters, and authorizes the Board to charge a reasonable fee approved by the probate judge for services to wards.

Court and court clerk's computerization fees 

Raises the additional maximum filing fee from $3 to $6 that the following courts may require to computerize the court or make available computerized legal research services: the probate court, domestic relations court, juvenile court, municipal court, county court, and Cuyahoga County Juvenile Court.

Raises the additional maximum filing fee from $10 to $20 that any of the above courts may require to computerize the office of the clerk of court and to make technological advances in the office.

Eliminates the current authority of a probate court, and the procedure, to approve an application for the transfer of structured settlement payment rights if the structured settlement agreement was not approved by an Ohio court.

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