In May 2025, substantial amendments to Minnesota’s trust and estate statutes were enacted. Some of these changes include changes to the Uniform Trust Code, the Uniform Probate Code, the Power of Appointment Act, and to modernize Minnesota’s statutory Rule Against Perpetuities. These revisions update the legal framework governing trusts and estates in Minnesota and enhance planning opportunities for multi-generation estate planning.

Below are brief summaries of several of the changes.

Extension of the Rule Against Perpetuities

Minnesota’s neighboring states have extended or eliminated their Rule Against Perpetuities. While not eliminating Minnesota’s Rule Against Perpetuities, the statutory vesting period for trusts created on or after August 1, 2025, has been increased from a time period of potentially 90 years to potentially 500 years.

This allows new Minnesota trusts to remain in existence for in excess of five centuries, enabling families to preserve wealth and exercise greater control over long-term planning. The amendment very favorably positions Minnesota among states that permit long-term or “dynasty” trusts.

Directed Trusts: Clarification of Roles and Liability

The updated legislation provides detailed guidance on the roles and responsibilities of individuals serving in non-trustee (quasi-fiduciary or non-fiduciary) capacities under directed trust arrangements—specifically individuals serving as investment trust advisors, distribution trust advisors, and trust protectors.

• Investment and distribution trust advisors are deemed fiduciaries and are generally held to the same standards as trustees unless the trust instrument lawfully narrows their duties.
• Trust protectors are not fiduciaries unless the governing instrument expressly states otherwise.
• The statute outlines liability limitations for excluded fiduciaries who act in reliance on directions from a directing party.
• The newly codified “office of directing party” is now subject to default rules that mirror those applicable to trustees, including provisions on compensation, resignation, removal, and replacement.

Increased Threshold for Uneconomic Trusts

The law increases the value threshold at which a trustee may terminate certain trusts without court involvement due to administrative inefficiency. The prior $50,000 threshold has been raised to $150,000.

A trustee utilizing this statute may now, after providing notice to qualified beneficiaries, terminate a trust with assets below this amount if the trustee determines the costs of administration outweigh the trust’s value.

Limits on Parental Inheritance in Cases of Estrangement

Minnesota has expanded the circumstances under which a parent may be barred from inheriting from a deceased child. In addition to existing rules applying to children who die as minors, the statute now includes adult decedents when two conditions are met:

1. There is clear and convincing evidence that, during the decedent’s minority, the parent engaged in conduct—such as abandonment, neglect, abuse, or chronic failure to support—that would have justified termination of parental rights under Minnesota law; and
2. The parent and adult child were estranged in the year prior to the child’s death.

This change reflects the legislature’s intent to prevent inheritance in cases of prolonged neglect or disconnection. Notwithstanding this change, the best means of disinheriting those who you do not want to receive assets from your estate is to have an estate plan in place that leaves assets to your desired beneficiaries.

Modification of Irrevocable Trusts by Agents

The law also modifies the authority of agents acting under a power of attorney following considerable litigation on this subject.

Going forward, an agent may only consent to the modification or termination of a noncharitable irrevocable trust if expressly authorized by the terms of the trust or by a power of attorney that clearly grants this power (if the trust instrument is silent with respect to this authority).

Importantly, Minnesota’s statutory short form power of attorney does not include this authority by default. Most of our clients have chosen not to give an attorney in fact this power. However, there may be instances in which you may want to provide your attorney in fact with this power, and this is yet another item you should discuss with your Henson Efron attorney when conducting a periodic review of your estate plan.

Time Limit to Contest Revocable Trusts

Minnesota law continues to permit trustees to limit the time for challenging or otherwise contesting a revocable trust’s validity to 120 days provided an appropriate written notice is sent to necessary interested persons.

The recent amendment clarifies the required content of that notice:

• It must now expressly state that the settlor has died, and
• It must include a copy of the trust instrument, the trustee’s name and address, and a statement of the deadline for initiating a legal challenge.

Changes Related to Divorce and Estate Planning Documents

Following a divorce or annulment, Minnesota law revokes most revocable estate planning provisions that benefit a former spouse or members of the former spouse’s family—unless those family members are also part of the decedent’s family (such as shared children or descendants). The types of provision include:

• Any revocable disposition, beneficiary designations, or appointments of property;
• Powers of appointment given to a former spouse; and
• Nominations of the former spouse or their family members to serve in fiduciary roles, such as trustee, personal representative, executor, conservator, agent, or guardian.

These revocations apply automatically unless the governing instrument clearly provides otherwise.

The change to Minnesota law reflects concerns raised by the Minnesota Supreme Court in Estate of Tomczik, where the statutory language left room for unintended post-divorce inheritances through extended family relationships.

Practical Considerations

These legislative changes may affect how trusts are drafted, administered, or interpreted. Whether you are a trustee, beneficiary, or otherwise involved in estate planning, now is a good time to review your existing documents. The team at Henson Efron is here to assist and ensure your plans reflect your intentions and comply with current law.

The purpose of this article is merely to provide general information and should not be construed as legal advice.