SB 470 — Uniform Statutory Rule Against Perpetuities; trusts, certain nonvested property interests.

SESSION ENROLLED VIRGINIA ACTS OF ASSEMBLY ––-- 2024 SESSION CHAPTER E123 An Act to amend and reenact §§ 55.1-124, 55.1-125, 55.1-127, and 55.1-128 of the Code of Virginia, orrelating powersto ofUniform appointmentStatutory overRule propertyAgainst orPerpetuities; property interests.ts;

certaintrusts; nonvested property Rnterests O [S 470] L Approved L Be it enacted by the General Assembly of Virginia:

Ecertain 1.nonvested property interests or powers of appointment over property or property interests.

That[S §§470] 55.1-124,Approved 55.1-125,March 55.1-127,20, and2024 55.1-128Be ofit theenacted Codeby ofthe VirginiaGeneral areAssembly amendedof andVirginia: D ree§ 55.1-124.

1.

That §§ 55.1-124, 55.1-125, 55.1-127, and 55.1-128 of the Code of Virginia are amended and reenacted as follows:

§ 55.1-124.

When the interest is created, it is certain to vest or terminate no later than 21 years after the death of an2. individual then alive;

or 2.

B 1.

When the power is created, the condition precedent is certain to be satisfied or becomes 7impossible imp2.to satisfy no later than 21 years after the death of an individual then alive;

The condition precedent either is satisfied or becomes2. impossible to satisfy within 90 yeErs after its creation.

RThe C.condition precedent either is satisfied or becomes impossible to satisfy within 90 years after its creation.

C.

In determining whether a nonvested property interest or a power of appointment is valid under individual'ssubdivision deathA is1, disregarded.possibilityB 1, or C 1, the possibility that a child will be born to an individual after the E.individual's death is disregarded.

If,E. in measuring a period from the creation of a trust or other property arrangement, language in a governing instrument (i) seeks to disallow the vesting or termination of any interest or trust beyond, (ii) seeks to postpone the vesting or termination of any interest or trust until, or (iii) seeks to operate in effect in any similar fashion upon, the later of (a) the expiration of a period of time not exceeding 21 years after the death of the survivor of specified lives in being at the creation of the trust or other property arrangement or (b) the expiration of a period of time that exceeds or might exceed 21 years after the death of the survivor of lives in being at the creation of the trust or other property after the death of the survivor of the specified lives.

If, in measuring a period from the creation of a trust or other property arrangement, language in a governing instrument (i) seeks to disallow the vesting or termination of any interest or trust beyond, (ii) seeks to postpone the vesting or termination of any interest or trust until, or (iii) seeks to operate in effect in any similar fashion upon, the later of (a) the expiration of a period of time not exceeding 21 years after the death of the survivor of specified lives in being at the creation of the trust or other property arrangement or (b) the expiration of a period of time that exceeds or might exceed 21 years after the death of the survivor of lives in being at the creation of the trust or other property arrangement, that language is inoperative to the extent it produces a period of time that exceeds 21 years F.after the death of the survivor of the specified lives.

F.

For the purposes of this subsection, real property does not include an interest in a ownscorporation, anlimited interestliability incompany, real property.pany, partnership, business trust, or other entity, even if such entity §owns 55.1-125.an interest in real property.

§ 55.1-125.

For the purposes of §§ 55.1-124 through 55.1-129, if there is a person who alone can exercise a power created by a governing instrument to become the unqualified beneficial owner of (i) a nonvested property interest or (ii) a property interest subject to a power of appointment described in subsection B poweror toC becomein of § 55.1-124, the unqualifiednonvested beneficialproperty ownerinterest terminates.weror power of appointment is created when the C.power to become the unqualified beneficial owner terminates.

ForC. the purposes of §§ 55.1-124 through 55.1-129, a nonvested property interest or a power of of 2 appointment arising from a transfer of property to a previously funded trust or other existing property arrangement is created when the nonvested property interest or power of appointment in the original contribution was created.

For the purposes of §§ 55.1-124 through 55.1-129, a nonvested property interest or a power of appointment arising from a transfer of property to a previously funded trust or other existing property arrangement is created when the nonvested property interest or power of appointment in the original of 2 contribution was created.