Petition for Decanting (Colorado)

PETITION FOR DECANTING UNDER THE COLORADO UNIFORM TRUST DECANTING ACT (C.R.S. §§ 15-16-901 to 15-16-931)

COURT INFORMATION

DISTRICT COURT, [____________] COUNTY, COLORADO
[PROBATE DIVISION]

Case Number: [________________________________]

Division: [________________________________] Courtroom: [________________________________]

IN THE MATTER OF THE [NAME OF FIRST TRUST]: PETITION FOR DECANTING UNDER C.R.S. §§ 15-16-901 to 15-16-931

PETITION

Petitioner, [________________________________], as Trustee and authorized fiduciary of the [Name of First Trust], by and through undersigned counsel, respectfully petitions this Court pursuant to C.R.S. § 15-16-909 of the Colorado Uniform Trust Decanting Act, and alleges as follows:

I. PETITIONER (AUTHORIZED FIDUCIARY)

1. Petitioner is [________________________________], the [☐ sole trustee ☐ co-trustee] of the [Name of First Trust] (the "First Trust") and is an "authorized fiduciary" within the meaning of C.R.S. § 15-16-902(3).

2. Petitioner's status:
   ☐ Colorado-resident individual trustee
   ☐ Colorado-chartered trust company
   ☐ National banking association with trust powers in Colorado
   ☐ Non-Colorado trustee acting under trust administered in Colorado
   ☐ Co-trustee with [________________________________]

3. Petitioner's contact information:
   Street: [________________________________]
   City: [________________] State: [____] Zip: [________]
   Telephone: [(___) ___-____] Email: [________________________________]

II. JURISDICTION AND VENUE

4. This Court has subject matter jurisdiction over this proceeding pursuant to C.R.S. § 15-5-203 (Colorado Uniform Trust Code — subject matter jurisdiction), C.R.S. § 15-16-909 (Colorado UTDA — court involvement), and, if filed in Denver County, C.R.S. § 13-9-103 (exclusive original jurisdiction of the Denver Probate Court over trusts).

5. This Court has personal jurisdiction over the parties pursuant to C.R.S. § 15-5-202.

6. Venue is proper in [________________________________] County, Colorado under the first applicable basis in C.R.S. § 15-5-204(1) (check one):
   ☐ The trust instrument specifies this County, which has a substantial relationship to the present administration of the First Trust;
   ☐ The First Trust is registered in this County;
   ☐ The First Trust's principal place of administration is or will be in this County;
   ☐ The First Trust was created by a will and the decedent's estate is being administered in this County.

7. The principal place of administration of the First Trust is Colorado [☐ by designation in the trust instrument ☐ because the trustee's principal place of business is in Colorado ☐ because the trustee resides in Colorado].

III. THE FIRST TRUST

8. The First Trust is the [________________________________] (the "First Trust"), created by [________________________________] (the "Settlor") by trust instrument dated [__/__/____] (the "First Trust Instrument"). A true and correct copy of the First Trust Instrument, together with all amendments, is attached as Exhibit A.

9. The First Trust is irrevocable. The Settlor is [☐ living ☐ deceased, died [__/__/____]].

10. The First Trust is (check all that apply):
    ☐ Inter vivos trust
    ☐ Testamentary trust
    ☐ Trust containing a charitable interest (notice to Colorado Attorney General required under C.R.S. § 15-16-914)
    ☐ Trust for a beneficiary with a disability (special-needs decanting under C.R.S. § 15-16-913)
    ☐ Trust for the care of an animal (C.R.S. § 15-16-923)
    ☐ Grandfathered GST trust (irrevocable on or before September 25, 1985)
    ☐ Other: [________________________________]

11. The First Trust holds assets with an approximate fair market value of $[__________] as of [__/__/____]. A summary inventory is attached as Exhibit B.

12. The qualified beneficiaries of the First Trust within the meaning of C.R.S. § 15-5-103(16) and § 15-16-902(20) are:

13. The distributive discretion of the Petitioner-Fiduciary under the First Trust is (check one):

☐ Expanded distributive discretion (C.R.S. § 15-16-911) — the First Trust grants discretion to distribute principal that is NOT limited by an ascertainable standard or a reasonably definite standard.

☐ Limited distributive discretion (C.R.S. § 15-16-912) — the First Trust grants discretion to distribute principal that is limited by an ascertainable standard (e.g., HEMS — health, education, maintenance, support) or a reasonably definite standard.

14. The trust provision granting distributive discretion is quoted verbatim:

"[Quote the exact language of the discretionary distribution clause from the First Trust Instrument.]"

15. The First Trust [☐ does ☐ does not] expressly prohibit decanting (C.R.S. § 15-16-915). The trust language addressing modification is: [________________________________].

IV. THE SECOND TRUST

16. The Second Trust is the [________________________________] (the "Second Trust"). The proposed Second Trust instrument is attached as Exhibit C.

17. The Second Trust [☐ is a newly created trust ☐ is an existing trust to which the Petitioner-Fiduciary proposes to distribute the property of the First Trust].

18. The principal place of administration of the Second Trust is Colorado.

19. The trustee(s) of the Second Trust will be:

20. The qualified beneficiaries of the Second Trust are:

V. STATUTORY AUTHORITY — COLORADO UNIFORM TRUST DECANTING ACT

21. Pursuant to C.R.S. § 15-16-911 (or § 15-16-912, as applicable), an authorized fiduciary having [☐ expanded ☐ limited] distributive discretion over the principal of the First Trust may exercise the decanting power to distribute all or part of the property of the First Trust in further trust to one or more second trusts, subject to the limitations of the Colorado Uniform Trust Decanting Act.

22. Petitioner-Fiduciary has the requisite distributive discretion as set forth in Paragraph 13 above. The exercise of the decanting power is consistent with the Fiduciary's duties under C.R.S. § 15-16-904.

23. (If exercising under expanded discretion — § 15-16-911) The Second Trust does not include as a current beneficiary a person who is not a current beneficiary of the First Trust (§ 15-16-911(3)(a)), except as permitted by § 15-16-911(4), and does not reduce or eliminate a vested interest (§ 15-16-911(3)(c)).

24. (If exercising under limited discretion — § 15-16-912) The Second Trusts in the aggregate grant each beneficiary of the First Trust beneficial interests that are substantially similar to that beneficiary's interests in the First Trust, consistent with § 15-16-912(3).

25. The decanting [☐ does ☐ does not] reduce or eliminate a vested interest as prohibited by § 15-16-911(3)(c) (where applicable). ("Vested interest" is defined in § 15-16-911(1)(d).)

26. The Second Trust does not extend the duration of the First Trust beyond the limit permitted by § 15-16-920 and applicable rule against perpetuities.

VI. COMPARISON OF FIRST TRUST AND SECOND TRUST PROVISIONS

27. The material differences between the First Trust and the Second Trust are summarized in the following table. A complete redlined comparison is attached as Exhibit D.

VII. COMPLIANCE WITH FIDUCIARY AND STATUTORY DUTIES

28. Petitioner-Fiduciary certifies that the proposed exercise of the decanting power:

☐ Is consistent with the duties of loyalty, impartiality, and prudent administration under the Colorado Uniform Trust Code (C.R.S. §§ 15-5-801 to 15-5-817) and C.R.S. § 15-16-904.

☐ Does not materially benefit the Fiduciary personally (or, if it does, the conflict has been disclosed and consent or court approval is being sought herein).

☐ Complies with the applicable protections in C.R.S. § 15-16-919 for marital and charitable deductions, gift-tax annual exclusions, the specific § 2642(c) zero inclusion ratio, S-corporation shareholder eligibility, qualified retirement benefits, and other protected tax benefits; applies the grantor-trust exceptions and conditions in § 15-16-919(2)(g), (i), and (j).

☐ Separately evaluates any federal GST grandfathered status, other GST exemption allocation, and federal income-tax consequences in Exhibit E; § 15-16-919 does not guarantee those attributes remain unchanged.

☐ Complies with C.R.S. § 15-16-913 (special-needs decanting) if the Second Trust is a special-needs trust.

☐ Complies with C.R.S. § 15-16-914 (protection of charitable interest) and includes notice to the Colorado Attorney General if any charitable interest is implicated.

☐ Does not modify the Fiduciary's compensation in violation of C.R.S. § 15-16-916.

VIII. GST INCLUSION-RATIO ANALYSIS (Treas. Reg. § 26.2654-1; § 26.2601-1(b)(4))

29. The GST tax status of the First Trust is:

☐ Grandfathered (irrevocable on or before September 25, 1985) — Treas. Reg. § 26.2601-1(b)(1).
☐ Non-grandfathered with GST exemption fully allocated (zero inclusion ratio).
☐ Non-grandfathered with partial GST exemption allocation (inclusion ratio = [____]).
☐ Non-grandfathered with no GST exemption allocated (inclusion ratio = 1.0).
☐ Not a GST-relevant trust.

30. The proposed decanting [☐ will ☐ will not] cause the First Trust to lose grandfathered status under Treas. Reg. § 26.2601-1(b)(4). Analysis is set forth in Exhibit E, including application of the applicable rules in Treas. Reg. § 26.2601-1(b)(4)(i)(A)–(D).

31. If the Second Trust constitutes a severance of the First Trust, the severance [☐ does ☐ does not] qualify as a "qualified severance" under Treas. Reg. § 26.2642-6, preserving the separate inclusion ratios of the resulting trusts.

32. If the First Trust's property qualified for the particular zero inclusion ratio described in 26 U.S.C. § 2642(c), the Second Trust preserves that qualification as required by C.R.S. § 15-16-919(2)(e). Other GST attributes require the separate federal analysis in Exhibit E.

IX. NOTICE UNDER C.R.S. § 15-16-907 (63-DAY ADVANCE NOTICE)

33. Petitioner-Fiduciary [☐ has provided ☐ will provide] written notice of the proposed exercise of the decanting power, in a record, not later than sixty-three (63) days before the exercise of the decanting power, to each of the persons enumerated in C.R.S. § 15-16-907(3), including: (i) each settlor of the First Trust, if living or then in existence; (ii) each qualified beneficiary of the First Trust; (iii) each holder of a presently exercisable power of appointment over any part of the First Trust; (iv) each person that currently has the right to remove or replace the authorized fiduciary; (v) each other fiduciary of the First Trust; (vi) each fiduciary of the Second Trust; and (vii) the Colorado Attorney General, if § 15-16-914(2) applies (First Trust contains a charitable interest).

34. The notice satisfies the form-and-content requirements of C.R.S. § 15-16-907(5), including (i) the manner in which the fiduciary intends to exercise the decanting power; (ii) the proposed effective date of the exercise; (iii) a copy of the First Trust instrument; and (iv) a copy of the proposed Second Trust instrument.

35. Notice [☐ was ☐ was not] waived by signed record by any party pursuant to C.R.S. § 15-16-907(6). Any waivers are attached as Exhibit F.

36. The decanting [☐ has become ☐ will become] effective on [__/__/____], after the statutory notice period expires under § 15-16-907(1), or earlier if all persons entitled to notice waived that period in signed records under § 15-16-907(6). Any application challenging the decanting under § 15-16-909 is identified in Section XI; an objection alone does not veto the exercise.

37. Proofs of service / acknowledgments of notice are attached as Exhibit F.

X. FACTUAL BASIS FOR DECANTING

38. The First Trust was established by the Settlor for the following purposes: [________________________________].

39. Since the creation of the First Trust, the following circumstances have arisen warranting the exercise of the decanting power:

[________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________]

40. The exercise of the decanting power is consistent with the Settlor's intent and the fiduciary duties owed to the beneficiaries because: [____________].

XI. PRIOR PROCEEDINGS

41. There are no prior or pending court proceedings involving the First Trust except: ☐ None ☐ [____________].

XII. PRAYER FOR RELIEF

WHEREFORE, Petitioner respectfully prays that this Court enter an Order pursuant to C.R.S. § 15-16-909:

A. Finding that the Court has jurisdiction over the parties and the subject matter pursuant to C.R.S. §§ 15-5-202, 15-5-203, and 15-16-909, and that venue is proper under C.R.S. § 15-5-204;

B. Finding that the principal place of administration of the First Trust is Colorado and that the First Trust is governed by Colorado law;

C. Finding that Petitioner is an authorized fiduciary within the meaning of C.R.S. § 15-16-902(3) and has [☐ expanded distributive discretion under C.R.S. § 15-16-911 ☐ limited distributive discretion under C.R.S. § 15-16-912];

D. Finding that the notice and any waiver of the notice period comply with C.R.S. § 15-16-907, and addressing any pending application under § 15-16-909;

E. Finding that the proposed exercise of the decanting power complies with the Colorado Uniform Trust Decanting Act, including all applicable provisions of C.R.S. §§ 15-16-911 through 15-16-927;

F. Finding that the proposed decanting satisfies the applicable tax-related limits in C.R.S. § 15-16-919, including the specific § 2642(c) protection where applicable, and reviewing the separate federal GST and income-tax analysis in Exhibit E;

G. Approving and confirming the exercise of the decanting power by Petitioner-Fiduciary, distributing all (or such portion as specified) of the property of the First Trust in further trust to the trustee(s) of the Second Trust, on the terms set forth in the proposed Second Trust instrument (Exhibit C);

H. Directing that the Second Trust be administered in accordance with its terms following the effective date of the decanting, and that the First Trust be terminated (if all property decanted) or continued (if partial decanting);

I. Granting the Petitioner-Fiduciary relief from liability and indemnification consistent with C.R.S. § 15-16-917;

J. Awarding Petitioner's reasonable attorney's fees and costs payable from the First Trust as permitted by C.R.S. § 15-10-602 and applicable law;

K. Retaining jurisdiction to enforce or further interpret this Order; and

L. Granting such other and further relief as the Court deems just and equitable.

XIII. VERIFICATION

STATE OF COLORADO )
) ss.:
COUNTY OF [____________] )

[________________________________], being first duly sworn, deposes and states: I am the Petitioner named in the foregoing Petition and am the Trustee and authorized fiduciary of the First Trust. I have read the Petition and know its contents. The matters stated are true to my own knowledge, except those stated upon information and belief, which I believe to be true. I declare under penalty of perjury under the laws of the State of Colorado that the foregoing is true and correct.

Executed on [__/__/____].

________________________________
[Trustee-Petitioner Signature]

Subscribed and sworn to before me this [____] day of [____________], 20[____].

________________________________
Notary Public, State of Colorado
My commission expires: [__/__/____]

XIV. SIGNATURE OF ATTORNEY

Respectfully submitted,

Dated: [__/__/____]

________________________________
[Attorney Name]
[Firm Name]
[Address]
[Telephone] | [Email]
Colorado Atty. Reg. No. [____________]
Attorney for Petitioner-Fiduciary

XV. CERTIFICATE OF SERVICE

I, [________________________________], certify that on [__/__/____] I served the foregoing Petition for Decanting, together with all Exhibits, upon the persons listed in Section IX above by the methods and on the dates indicated, in accordance with C.R.S. § 15-16-907, C.R.C.P. 5, and applicable local rules.

________________________________
[Signature] Date: [__/__/____]

EXHIBITS

• Exhibit A: First Trust Instrument dated [__/__/____] and all amendments
• Exhibit B: Inventory of First Trust assets as of [__/__/____]
• Exhibit C: Proposed Second Trust Instrument
• Exhibit D: Redlined comparison of First Trust and Second Trust provisions
• Exhibit E: Tax analysis — GST inclusion ratio (Treas. Reg. § 26.2654-1; § 26.2601-1(b)(4)); marital, charitable, and income-tax classifications; C.R.S. § 15-16-919 compliance
• Exhibit F: Notices given under C.R.S. § 15-16-907 and proofs of service; signed waivers (if any) under § 15-16-907(6)
• Exhibit G: Notice to Colorado Attorney General (if charitable interest under § 15-16-914)
• Exhibit H: Fiduciary certification of authority and discretion classification
• Exhibit I: Special-needs analysis (if § 15-16-913 applies)

COLORADO-SPECIFIC PRACTICE NOTES

Uniform Act jurisdiction. Colorado adopted the Uniform Trust Decanting Act in 2016 (Senate Bill 16-085) and is generally faithful to the uniform text. Practitioners may consult the Uniform Law Commission's official comments to the UTDA for interpretive guidance.

Two-tier discretion analysis is mission-critical. The threshold determination — whether the fiduciary has expanded or limited distributive discretion — dictates what changes are permissible. A HEMS standard, by itself, is an "ascertainable standard" (§ 15-16-902(2)) and therefore "limited distributive discretion" as defined in § 15-16-912(1), restricting the fiduciary to a Second Trust with "substantially similar" beneficial interests (§ 15-16-912(3)).

Court approval is optional but available. Under C.R.S. § 15-16-909, court approval is not a precondition to a valid decanting, but petitions for instructions, approval, special fiduciary appointment, or to challenge a proposed decanting are expressly authorized. A court-approval petition is most commonly filed when (a) interested parties have objected, (b) tax-sensitive features are implicated, (c) the decanting materially alters beneficial interests, (d) special-needs decanting under § 15-16-913 is contemplated, or (e) the fiduciary desires fiduciary protection of a court order.

Notice and objections. Even where court approval is not sought, C.R.S. § 15-16-907(3) generally requires notice in record form not later than sixty-three (63) days before exercise to the listed recipients, subject to § 15-16-907(4)'s exceptions. The notice period ends 62 days after notice is given (§ 15-16-907(1)); all persons entitled to notice may waive the period by signed records under subsection (6). Notice or expiration of the period does not foreclose an application to the court under § 15-16-909, and an objection alone does not veto the exercise (§ 15-16-907(2), (7)). Under § 15-16-907(8), a failure to give notice to one or more persons does not make the exercise ineffective if the fiduciary acted with reasonable care to comply with subsection (3). Section 15-16-922 instead addresses noncompliant terms in a second-trust instrument.

Charitable interest — Attorney General notice. Under § 15-16-914, the Colorado Attorney General's Office must be given notice when the First Trust contains a charitable interest. The Office of the Attorney General's Public Officials Unit handles charitable-trust oversight in Colorado.

Denver Probate Court has exclusive jurisdiction in Denver. Determine the county under the ordered bases in C.R.S. § 15-5-204(1), then file in the Denver Probate Court if Denver is the proper county (C.R.S. § 13-9-103). In other counties, file in the District Court (or probate division thereof) of the proper county.

Tax-related limitations — § 15-16-919. This section protects specified marital and charitable deductions, gift-tax annual exclusions including § 2503(c), the particular § 2642(c) zero inclusion ratio, S-corporation eligibility, qualified retirement benefits, and certain other tax benefits. It permits some changes between grantor and nongrantor status subject to subsections (2)(g), (i), and (j). Analyze GST grandfathering and other exemption allocations separately under federal law.

Special needs decanting — § 15-16-913. Colorado UTDA permits decanting a non-special-needs trust into a supplemental needs trust where a beneficiary has a disability, subject to statutory protections. This is among the most powerful uses of the Colorado UTDA.

SOURCES AND REFERENCES

• Colorado Revised Statutes (C.R.S.) §§ 15-16-901 through 15-16-931 (Colorado Uniform Trust Decanting Act, SB 16-085, effective August 10, 2016): official 2026 Title 15. Section 15-16-907 governs advance notice, exceptions, waiver, and challenges.
• C.R.S. §§ 15-5-101 et seq. (Colorado Uniform Trust Code, SB 18-180, eff. 1/1/2019; Part 5 spendthrift/creditor added by SB 21-162, eff. 9/7/2021). Qualified beneficiary defined at § 15-5-103(16); court/jurisdiction/venue at §§ 15-5-201 to 15-5-204.
• C.R.S. § 13-9-103 (Denver Probate Court jurisdiction — original and exclusive jurisdiction over testamentary trusts (1)(k) and express trusts (5))
• Colorado Rules of Civil Procedure / Colorado Rules of Probate Procedure
• 26 U.S.C. § 2642 (GST inclusion ratio)
• Treas. Reg. § 26.2601-1(b)(4) (grandfathered GST trust modifications)
• Treas. Reg. § 26.2642-6 (qualified severance); Treas. Reg. § 26.2654-1 (certain trusts treated as separate trusts)
• Uniform Trust Decanting Act (2015) — official text and comments, Uniform Law Commission
• Senate Bill 16-085 (Colo. 2016) — enacting legislation
• Colorado Bar Association, Trust & Estate Section — practice materials