Bill H.23, introduced by Representative LaLonde, aims to enhance the protection of property held by spouses as tenants by the entirety when transferred into a trust. The bill amends 14A V.S.A. § 505 to establish that property conveyed to revocable or irrevocable trusts by spouses retains immunity from creditor claims, similar to the protection it had before the transfer. This immunity applies as long as certain conditions are met, including that the spouses are married, the property is held in the trust, and the trust can be revoked by either spouse acting alone.

Additionally, the bill specifies that property held in a tenants by the entirety trust will maintain the same immunity from creditors as if it were held outside the trust, unless otherwise stated by the settlors. However, this immunity will cease upon the dissolution of the marriage by a court. The provisions of this bill apply to all trusts created before, on, or after its effective date, and it will take effect upon passage.

Statutes affected:
As Introduced: 14A-505