What Is A Nonjudicial Settlement Agreement

While settlement agreements provide practitioners with another tool in their estate planning toolkit, they are just one option among others, should not be taken lightly, and should be considered as a whole in the context of the estate plan. One of the most common and versatile uses of an NJSA is to eliminate a family trust (also known as a „credit shelter trust“), which is often established on the death of the first spouse in many living trust agreements. In 2019, the equivalent of the federal discount tax exemption is $11,400,000, which means that the estates of unmarried people who die in 2019 are only subject to federal discount tax if the value of the deceased`s assets exceeds that amount. The current federal equivalent of the inheritance tax exemption is much higher than it was in 2000, when it was only $675,000, for example. In 2018, the Colorado Legislature passed the Colorado version of the Colorado Uniform Trust Code (CUTC), with a date of january 2, 2019. A previous Colorado Lawyer article covered a number of ways to change irrevocable trusts, including using the methods set out in the CUTC. This article delves into one of CUTC`s most exciting areas, CRS §15-5-111 for an Out-of-Court Settlement Agreement (NJSA), which states that „any person may enter into a binding out-of-court settlement agreement with respect to any matter involving a trust, whether or not the settlement agreement is supported by a counterparty, “ unless an NJSA violates a material purpose of the Trusts or contains terms that could not be properly approved by a trust. a court.. .

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