STATE OF NEW YORK
________________________________________________________________________
7475
2023-2024 Regular Sessions
IN SENATE
May 30, 2023
___________
Introduced by Sen. HOYLMAN-SIGAL -- (at request of the Office of Court
Administration) -- read twice and ordered printed, and when printed to
be committed to the Committee on Judiciary
AN ACT to amend the surrogate's court procedure act, in relation to the
computation and allocation of the commissions of trustees of charita-
ble trusts; and to repeal certain provisions of such law relating
thereto
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Paragraphs (a) and (b) of subdivision 5 of section 2308 of
2 the surrogate's court procedure act, as amended by chapter 601 of the
3 laws of 2019, are amended to read as follows:
4 (a) During the continuance of a trust created solely for public, reli-
5 gious, charitable, scientific, literary, educational or fraternal uses
6 and during the period of continuance of such a trust established after
7 the termination of a life use or uses the trustee shall be entitled to
8 and may retain annual commissions [from income in an amount annually
9 equal to 6 per cent of income collected in each year] according to the
10 terms specified in subdivision 2 of this section, but only to the extent
11 of 80 percent of the rates stated therein. Notwithstanding any
12 other provision of law, with respect to any portion of such trust
13 which exceeds a principal value of twenty million dollars, the trustee
14 may only take annual commissions to the extent of 50 percent of the rate
15 specified in paragraph (c) of subdivision 2 of this section.
16 (b) In the case of a trust [created solely for public, religious,
17 charitable, scientific, literary, educational or fraternal uses the]
18 described in paragraph (a) of this subdivision, a trustee shall not be
19 entitled to any commission from principal as specified in subdivision 1
20 of this section for paying out principal.
21 § 2. Paragraph (c) of subdivision 6 of section 2308 of the surrogate's
22 court procedure act is REPEALED.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD09925-01-3
S. 7475 2
1 § 3. Subdivision 12 of section 2308 of the surrogate's court procedure
2 act, as amended by chapter 601 of the laws of 2019, is amended to read
3 as follows:
4 12. If a trustee of a trust [or donee of a power in trust] is author-
5 ized or required by the terms of the will to accumulate income for any
6 purpose permitted by law, any income so accumulated which is not added
7 to principal of the trust [or to the principal of the property subject
8 to the power in trust] shall be deemed a separate trust [or separate
9 fund subject to the power in trust] for purposes of this subdivision and
10 the trustee [or donee of the power in trust] shall be entitled to
11 commissions in respect thereof at the rates and according to the terms
12 and provisions of subdivisions 1 [and], 2 and 5 of this section as
13 though, for purposes of computing commissions of the trustee, income so
14 accumulated was principal.
15 § 4. Subdivision 3 of section 2309 of the surrogate's court procedure
16 act, as amended by chapter 601 of the laws of 2019, is amended to read
17 as follows:
18 3. Unless the will or lifetime trust instrument otherwise explicitly
19 provides, the annual commissions allowed by [subdivision 2] this section
20 shall be payable one-third from the income of the trust [or property
21 subject to the power in trust] and two-thirds from the principal of the
22 trust [or property subject to the power in trust]. However, in the case
23 of a trust whose definition of income is governed by section 11-2.4 of
24 the estates, powers and trusts law or a charitable remainder annuity
25 trust or a charitable remainder unitrust, as defined in section six
26 hundred sixty-four of the Internal Revenue Code of nineteen hundred
27 eighty-six, as amended, such annual commissions shall be payable from
28 the corpus of any such trust after allowance for the annuity or unitrust
29 amounts and shall not be payable out of such annuity or unitrust
30 amounts.
31 § 5. Paragraphs (a) and (b) of subdivision 5 of section 2309 of the
32 surrogate's court procedure act, as amended by chapter 601 of the laws
33 of 2019, are amended to read as follows:
34 (a) During the continuance of a trust created solely for public, reli-
35 gious, charitable, scientific, literary, educational or fraternal uses
36 and during the period of continuance of such a trust established after
37 the termination of a life use or uses the trustee shall be entitled to
38 and may retain annual commissions [from income in an amount annually
39 equal to 6 per cent of income collected in each year] according to the
40 terms specified in subdivision 2 of this section, but only to the extent
41 of 80 percent of the rates stated therein. Notwithstanding any other
42 provision of law, with respect to any portion of such trust which
43 exceeds a principal value of twenty million dollars, the trustee may
44 only take annual commissions to the extent of 50 percent of the rate
45 specified in paragraph (c) of subdivision 2 of this section.
46 (b) In the case of a trust [created solely for public, religious,
47 charitable, scientific, literary, educational or fraternal uses the]
48 described in paragraph (a) of this subdivision, a trustee shall not be
49 entitled to any commission from principal as specified in subdivision 1
50 of this section for paying out principal.
51 § 6. Paragraphs (a) and (b) of subdivision 3 of section 2312 of the
52 surrogate's court procedure act, as amended by chapter 601 of the laws
53 of 2019, are amended to read as follows:
54 (a) during the continuance of a trust created solely for public, reli-
55 gious, charitable, scientific, literary, educational or fraternal uses
56 and during the period of continuance of such a trust established after
S. 7475 3
1 the termination of a life use or uses a corporate trustee shall be enti-
2 tled to and may retain annual commissions [from income] in accordance
3 with the provisions of subdivision 1 or 2 [hereof] of this section, as
4 the case may be, except that the trustee shall not be entitled to a
5 commission for paying out principal.
6 (b) In the case of a trust created solely for public, religious, char-
7 itable, scientific, literary, educational or fraternal uses a corporate
8 trustee shall not be entitled to any commission [from] for paying out
9 principal.
10 § 7. This act shall take effect immediately and shall apply to all
11 trusts in existence on or after such effective date; provided, however,
12 that a trustee of a trust in existence on such effective date may elect
13 to continue to take commissions under the law in effect prior to such
14 effective date until December 31 of the year this act takes effect.
