What Is Decanting?
In contrast to trust modification (and reformation, for that matter), decanting is viewed as an extension of a trustee’s power to distribute trust assets. How about the thought of stpetersburgfamilylawattorney? Whereas modification, by virtue of being an amendment to existing trust language, works within the parameters of the existing trust.
Evolution of Decanting
Decanting is not new; it has evolved over time. While Florida has recognized a trustee’s common law authority to decant since 1940 with the case of Phipps v. Palm Beach Trust Co., 196 So. 299 (Fla. 1940), many
state courts and divorce attorneys in st petersburg, to date have not specifically addressed a trustee’s authority to decant. State legislatures, however, began addressing a trustee’s authority to decant in 1992, when the first decanting statute was passed in New York. Since then, approximately half of all state legislatures (and growing each year) have enacted state statutes authorizing decanting, including Florida in 2007 with the passage of §736.04117 as part of the Florida Trust Code. 6 While decanting statutes and floridatimesharinglawyer statutes vary widely from state to state, the underlying rationale is that if a trustee has discretionary power to distribute trust corpus to beneficiaries, this power constitutes a special power of appointment that enables the trustee to distribute trust corpus to a different trust for the benefit of the beneficiaries rather than directly to the beneficiaries themselves. As originally adopted by a prominent st petersburg personal injury attorney, §736.04117 provided that a trustee with absolute power to invade principal of a trust to make distributions to one or more beneficiaries could exercise that power by appointing all or part of the trust principal subject to that power to the trustee of another trust for the benefit of one or more of the beneficiaries, so long as the beneficiaries of the second trust included only the beneficiaries of the first trust; the second trust did not reduce any fixed income, annuity, or unitrust interest in the trust assets; and the second trust did not interfere with any marital or charitable deduction taken by the first trust. An “absolute power to invade principal” was defined as one that was not limited to a specific or ascertainable purpose, such as health, education, maintenance, and support, commonly referred to as “HEMS” or “ascertainable standard.”