Protect New Mexico

Your source for environmental information at the NM legislature

HB 041: PERPETUITIES FOR CERTAIN TRUST PROPERTIES

An Act Relating To Property Interests; Revising The Statutory Rule Against Perpetuities For Certain Property Interests Held In Trust.

LoadingAdd to My Bills

MOD HB 041
PERPETUITIES FOR CERTAIN TRUST PROPERTIES

Legislative URL:
HB 041 on nmlegis.gov
Emergency Clause:
No
Germane:
N/A
Location:
- OTHER -
Action:
HPREF [2] HCPAC/HJC-HCPAC [7] DP-HJC [15] DP [16] PASSED/H (61-1) [9] SCONC/SJC-SCONC [32] DP-SJC API.
Issue(s):

Related Legislators

Bill Sponsor:

Related Documents

Downloads:
Introduced
HCPAC Committee Report
HJC Committee Report
Final House Vote
SCONC Committee Report
Fiscal Impact Report
Summary

Current New Mexico law includes a “Rule Against Perpetuities,” the bane of law students everywhere, that is designed to prevent assets from being tied up in trust that are not subject to estate and gift taxes for longer than certain periods. House Bill 41 would exempt interests in trusts except for interests in real property, water and water rights that are held by a trust. It creates a special rule for those types of property requiring that the real property, water or water rights be distributed from the trust after 110 years from the date on which that property or right became part of the trust or the trust became irrevocable. The interest must be distributed according to a hierarchy of options set forth in the bill with the trust’s own terms given preference.

The bill defines an “interest in real property or water or water rights” as any direct or indirect (such as owning shares of a corporation that owns the water right) interest in real property, water or water rights located in New Mexico. Although the time frame for distribution under the proposal is a bit different than current law, the differences may not be significant with respect to interests in real property, water or water rights in comparison with current law.

Outcome: HB 41 passed the House (61-1), but died in the Senate Judiciary Committee.

Date of Summary:  1/15/13; Updated 5/16/13