The proposed "unitrust act" seeks to enhance the management of trusts in Michigan by granting fiduciaries the authority to convert income trusts into unitrusts and vice versa, as well as to modify the calculation methods for unitrust amounts. The bill introduces new definitions for key terms such as "applicable value," "income beneficiary," "unitrust," and "trustee," and clarifies that it applies to trusts administered in Michigan unless the trust's terms explicitly prohibit it. It also outlines the conditions under which trustees can make these conversions, including the requirement to notify qualified trust beneficiaries and the option to appoint independent special trustees when necessary.

Additionally, the bill establishes that a trustee's discretionary decisions under this act cannot be challenged by a court unless deemed an abuse of discretion, while emphasizing that trust terms take precedence over the act's provisions. It includes specific guidelines for unitrust policies, asset valuation, and the treatment of accrued income and liabilities. The act allows for flexibility in the timeframes used for unitrust policies and provides clear instructions for beneficiary distributions, aiming to promote uniformity in trust law across states and modifying certain provisions of the Electronic Signatures in Global and National Commerce Act for trusts created after its effective date.