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Understanding the Rule Against Trusts of Perpetual Duration
Definition & Meaning
The rule against trusts of perpetual duration is a legal principle that restricts noncharitable trusts from existing indefinitely. Specifically, these trusts must terminate within a specified period, which typically includes the lifetime of a currently living individual plus an additional 21 years. If a trust extends beyond this timeframe, it is considered void. This rule ensures that property remains transferable and does not become tied up indefinitely, similar to the rule against inalienability.
Table of content
Legal Use & context
This rule is primarily relevant in the context of estate planning and trust law. It applies to noncharitable trusts, which are created for purposes other than charitable giving. Understanding this rule is crucial for individuals and attorneys involved in drafting trusts, as it helps ensure compliance with legal requirements. Users can utilize legal templates from US Legal Forms to create compliant trust documents, making the process more accessible.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A family creates a trust to manage their assets for their children. The trust specifies that it will last until the youngest child reaches the age of 30. Since this period is within the allowable timeframe, the trust is valid.
Example 2: A person establishes a trust intended to last for 100 years for personal purposes. This trust would violate the rule against trusts of perpetual duration and would be deemed void. (hypothetical example)
State-by-state differences
State
Perpetuity Period
California
Life of a person plus 21 years
New York
Life of a person plus 21 years
Florida
Vests within 360 years
This is not a complete list. State laws vary and users should consult local rules for specific guidance.
Comparison with related terms
Term
Definition
Rule Against Perpetuities
Prohibits interests in property from lasting indefinitely, similar to the rule against trusts of perpetual duration.
Charitable Trusts
Trusts that are not subject to the rule against perpetual duration, as they serve charitable purposes.
Common misunderstandings
What to do if this term applies to you
If you are considering establishing a trust, ensure it complies with the rule against trusts of perpetual duration. You can explore US Legal Forms for templates that help you create a compliant trust. If your situation is complex or involves significant assets, consulting a legal professional is advisable to navigate the intricacies of trust law.
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