IL HB4663

Amends the Trust and Trustees Act to establish framework for "directed trusts" with three types of directing parties: investment trust advisors, distribution trust advisors, and trust protectors.

Investment trust advisors may direct trustee decisions regarding asset retention, purchase, sale, investment management, voting powers, and compensation of advisors; distribution trust advisors may direct discretionary distribution decisions to beneficiaries.

Trust protectors may modify trust instruments for tax purposes, alter beneficiary interests, modify powers of appointment, remove or appoint trustees and advisors, terminate trusts, change trust situs or governing law, and interpret trust terms.

Excludes fiduciaries directed by directing parties from liability for following directions (except willful misconduct) and relieves them from duty to monitor or investigate the directing party's exercise of powers.

Applies to all existing and future trusts that appoint directing parties, including those modified by court order or nonjudicial settlement agreement; trusts may opt out by express reference to Section 16.3.