May 26, 2020 17 minutes to read ∙ 3800 words

Benefit-of-the-Beneficiary Rule

By Mary P. O’Reilly and Lee-ford Tritt

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Reprinted with permission from Probate & Property, March/April 2020, Volume 34, Number 2, at 25-29. ©2020 by the American Bar Association. All rights reserved. This information or any or portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.

In July 2018, Florida joined a growing group of states that have eliminated or severely curtailed the so-called Benefit-of-the-Beneficiary Rule from its trust code. See Fla. Stat. §§ 736.0103(11), 736.0105(2)(c), 736.0404 (2018). Other state bar organizations that are currently preparing legislation to adopt parts of the Uniform Trust Code (UTC) have decided to forego adopting the Benefit-of-the-Beneficiary Rule. See H.B. 1471, 101 Gen. Assembly, at pages 11-12 (Ill. 2019 and 2020). What is this rule and why has it become so controversial?

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