The Senate Judiciary Committee heard HB 1056, sponsored by Sen. Steele, on probate and trust administration matters. The introduced version of this bill was prepared by the Probate Study Committee in consultation with the Indiana State Bar Association (ISBA) Probate Committee. The bill makes numerous changes to current law on personal representatives and trust administration. A representative of the ISBA Probate Committee summarized each provision of the bill for the Committee. The bill passed, 8-0.

The Senate Corrections Committee heard HB 1130, sponsored by Sen. Pat Miller and Sen. Hume, adding “gravely disabled” as an alternative basis to “dangerous” for detaining persons under the immediate detention statute.  The bill makes the grounds for an emergency detention consistent with those provided for temporary and regular commitments. The bill passed, 8-0.

Bill No.	Bill Title	Committee	2nd Reading	3rd Reading	Sponsor(s)
HB 1056	Probate and trust administration	1/15/13 Do Pass	1/17/13 Engrossed	1/22/13 Passed 96-0	Steele
HB 1130	Immediate detention	2/12/13 Do Pass	2/14/13 Engrossed	2/18/13 Passed 97-0	Pat Miller, Hume

The House Judiciary Committee heard HB 1130, Rep. C. Brown’s bill on adding “gravely disabled” to immediate detention.  Prepared by the Commission on Mental Health and Addiction, the bill provides that an individual who is gravely disabled, in addition to having a mental illness and being in immediate need of hospitalization, may be detained by a law enforcement officer and transported to the nearest appropriate facility. Rep Brown explained that this makes the immediate detention statute consistent with the emergency and temporary commitment statutes. The Indiana chapter of the National Association for the Mentally Ill (NAMI) and Mental Health of Indiana testified in support of the bill. The bill passed, 9-0.

The House Judiciary Committee heard HB 1056 on probate and trust administration authored and presented by Rep. McMillin. The bill adds a definition of probate estate; amends the inventory statute to refer to the probate estate in Ind. Code § 29-1-7.5-3.2; adds provisions that the estate lawyer: represents and owes a duty only to the personal representative, does not have a duty regarding estate assets unless required by  a specific order of the court, and is not liable for loss suffered by the estate except to the extent the loss was caused by the lawyer’s breach of duty to the personal representative; provides that the authority to act with respect to an estate under Ind. Code § 29-1-7 and Ind. Code § 29-1-7.5 is vested with the personal representative and that if this article prohibits an action by a personal representative, then the personal representative is restricted unless a majority in interest of the distributees expressly consent to the action or the statute imposing the restriction expressly permits the court to approve the action; amends Ind. Code § 29-1-12-1inventory requirements and refers to the probate estate; removes the subsection regarding costs and expenses for a surrogate attorney; amends Ind. Code § 29-1-15-16.5 regarding sale of real property that causes the personal representative to acquire a beneficial interest in the property; amends the guardianship accounting provisions to require the court to conduct a hearing on each verified accounting, expands the list of persons required to received such  notices, and permits the court to appoint a guardian ad litem to review the accounting for the protected person if certain conditions are met; adds provisions dealing with revocable trusts and matrimonial trusts.  A representative from the Indiana State Bar Probate, Trust, and Real Property section discussed the bill and testified in support. The bill passed 12-0.

Power of attorney and attorney in fact

S.E.A. 157, P.L. 42-2012

Effective July 1, 2012

Provides that a copy of the power of attorney has the same force and effect as the original power of attorney if the person granting the power of attorney certifies that the copy is a true and correct copy. Specifies that a child of the principal may request an accounting with respect to transactions entered into by an attorney in fact. Urges the legislative council to study issues related to powers of attorney during the 2012 interim.

Immediate detention orders

S.E.A. 176, P.L. 62-2012

Effective July 1, 2012

Authorizes a court to order an individual to be transported to an appropriate facility (excluding a state institution) for a preliminary medical and psychological evaluation if the court has reasonable grounds to believe that the individual (1) has a mental illness, (2) is dangerous, and (3) is in immediate need of hospitalization and treatment. Provides that the costs of transportation and care must be paid by the county in which the individual was taken into custody if there were not reasonable grounds to believe that the individual had a mental illness and was dangerous.

Inheritance tax

S.E.A. 293, P.L. 157-2012

Effective July 1, 2012

Reclassifies a spouse, widow, or widower of a child or stepchild of the transferor as a Class A transferee instead of a Class B or Class C transferee.  Increases the inheritance tax exemption amount for Class A transferees from $100,000 to $250,000 with respect to taxable transfers resulting from the deaths of individuals dying after December 31, 2011.  Phases out the inheritance tax over 9 years beginning in 2013.  Phases out the inheritance tax replacement amounts payable to counties over 10 years beginning with amounts payable for the state fiscal year beginning July 1, 2012.

Various estate administration matters

H.E.A. 1258, P.L. 149-2012

Effective March 19, 2012 (§§11, 13-16); July 1, 2012 (§§1-10, 12, 17-19)

Provides that transfers made to entities, as defined in the code, are taxed at the same percentages as the individual’s beneficial or ownership interest in the entity.  Eliminates the ability to file a recovery claim against a Medicaid recipient’s spouse.  Provides that foreign wills probated after the deadlines expire are limited in the same way as Indiana wills probated after the deadlines expire.  Provides that the costs and expenses of administration include fees of a surrogate attorney that has been approved by the court under the rules and have been filed as a claim in the estate of a deceased attorney in determining priority of claims.  Provides that a standby guardian has the same powers granted to a guardian by statute.  Provides that if custodial property, including a custodial account, is worth less than $10,000 a guardian does not need to be appointed under IC 29-3-3-1.  Provides that amendments to IC 30-4 regarding trusts applies to all trusts created prior to the amendments unless stated otherwise in this article of the code, or to do so would adversely affect a right of a beneficiary, give a right to a beneficiary that was not intended when the trust was created, impose a duty or liability on any person that was not intended when the trust was created, or relieve any person from a duty or liability imposed by the terms of the trust or under prior law.  Provides that amendments to the law concerning transfers on death apply to all such transfers created prior to the effective date of the applicable amendment and that a testamentary trust with transfer on death property comes into existence as of the owner’s death if the owner’s last will and testament is admitted to probate.  Makes several amendments regarding the rights of a personality’s rights of publicity.

See also:

Guardianships

S.E.A. 32, P.L. 115-2012

Description under Family & Juvenile Law.

The House Judiciary Committee heard SB 176 regarding immediate detention orders sponsored by Rep. Foley.  This bill permits a court to order an individual to be transported to an appropriate facility for a preliminary medical and psychological evaluation if the court has reasonable grounds to believe that the individual has a mental illness, is dangerous, and is in immediate need of hospitalization and treatment. This bill also provides that the costs of transportation and care must be paid by the county if there were not reasonable grounds to believe that the individual had a mental illness and was dangerous. The bill passed, 11-0.

The House Ways and Means Committee heard SB 293, regarding inheritance tax sponsored by Rep. Turner, Rep. Welch, Rep. Grubb, and Rep. McMillin. The bill was amended in committee and now reclassifies a spouse, widow, or widower of a child of the transferor as a Class A transferee instead of a Class B transferee, and a spouse, widow, or widower of a stepchild of the transferor as a Class A transferee instead of a Class C transferee. The amended bill provides that IC 6-4.1- 1 through 9, and IC 6-4.1-12 do not apply to property interest transfers by a decedent whose death occurs after June 30, 2022.  Finally, the amended bill increases the exemption for Class A transferees (to $250,000), Class B and C transferees (to $25,000) for transfers resulting from the death of the decedent after June 30, 2012, amends the percentages for credits allowed, and amends the formula for the inheritance tax replacement amount for each county through June 30, 2022. The bill passed as amended 22-3.

The House Judiciary Committee heard SB 32 on guardianships sponsored by Rep. Foley. This bill allows a guardian of a minor who has not been adjudicated an incapacitated person to file a verified petition to extend the guardianship until the incapacitated person is 22 years old, and authorizes the court to grant the petition if it is in the best interests of the protected person. This bill also specifies that the extension of the guardianship does not place the person under a legal disability.  The bill was amended in committee so that “the guardian and the protected person who is at least 17 years of age may jointly petition the court.” The amended bill passed with a vote of 11-0.

The House Judiciary Committee heard SB 157 regarding power of attorney and attorney in fact sponsored by Rep. Foley and Rep. Koch. This bill provides that a copy of the power of attorney has the same force and effect as the original power of attorney if the person granting the power of attorney certifies that the copy is a true and correct copy. It also specifies that a child of the principal may request an accounting with respect to transactions entered into by an attorney in fact. The bill passed with a vote of 11-0.

The Senate Judiciary Committee heard HB 1258 on various estate planning matters sponsored by Sen. Zakas, Sen. Glick and Sen. Broden. Author Rep. Foley introduced the bill, a product of the Probate Code Study Commission, highlighting areas of the bill providing remedies for individuals taken advantage of through bad estate practices. A representative of the Indiana State Bar Association testified in support of the bill. The bill passed 7-0.

Bill No.	Bill Title	Committee	2nd Reading	3rd Reading	Sponsor(s)
SB 157	Copy of power of attorney	1/23/12 Do Pass –A	1/26/12 Engrossed	1/31/12 Passed 50-0	Foley, Koch
SB 176	Immediate detention orders	1/12/12 Do Pass	1/17/12 Engrossed –A	1/23/12 Passed 50-0	Foley
SB 293	Inheritance tax	1/26/12 Do Pass –A	1/30/12 Engrossed	1/31/12 Passed 50-0	Turner, McMillin, Grubb, Welch
HB 1258	Various estate planning matters	1/23/12 Do Pass –A 1/27/12 Do Pass –A	1/30/12 Engrossed	1/31/12 Passed 96-0	Zakas, Glick, Broden

The Senate Tax and Fiscal Policy Committee heard SB 293 on inheritance tax authored by Sen. Smith and Sen. Hershman. This bill reclassifies a spouse, widow, or widower of a child of the transferor as a Class A transferee instead of a Class B transferee, and a spouse, widow, or widower of a stepchild of the transferor as a Class A transferee instead of a Class C transferee. This bill annually increases the inheritance tax exemption amounts through 2015, provides that the tax base for determining the inheritance tax includes the exempted amount but applies a 0% tax rate to transfers that are equal to or less than the exempted amounts, and reduces the inheritance tax rates by 50% for transfers resulting from the death of an individual who dies after June 30, 2016. Additionally, this bill repeals the Indiana estate tax on July 1, 2012, and provides that the repealed statutes, as in effect on June 30, 2012, apply to the estate of an individual who dies before July 1, 2012. The bill was amended to delete language regarding filing for the refund of inheritance or Indiana estate tax which has been erroneously or illegally collected, and appeals.  The bill passed, as amended, 12-0.

The House Ways and Means Committee resumed discussion of HB 1258 concerning various estate planning matters authored by Rep. Foley, Rep. McMillin and Rep. DeLaney. Rep. Espich offered an amendment deleting references to Medicaid liens in the bill to provide the Committee with further opportunity to determine the fiscal impact of this language on the State of Indiana. The amended bill passed 17-0.

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The Legislative Update is a weekly update of the activities of the Indiana General Assembly and a publication of the Indiana Judicial Center.