In this chapter the following terms have the following meanings:

(1) APPOINTIVE PROPERTY. The property or property interest subject to a power of appointment.
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Terms Used In Alabama Code 19-3D-2

  • Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Donor: The person who makes a gift.
  • Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
  • Fiduciary: A trustee, executor, or administrator.
  • following: means next after. See Alabama Code 1-1-1
  • Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
  • person: includes a corporation as well as a natural person. See Alabama Code 1-1-1
  • Power of attorney: A written instrument which authorizes one person to act as another's agent or attorney. The power of attorney may be for a definite, specific act, or it may be general in nature. The terms of the written power of attorney may specify when it will expire. If not, the power of attorney usually expires when the person granting it dies. Source: OCC
  • property: includes both real and personal property. See Alabama Code 1-1-1
  • Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
  • state: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Alabama Code 1-1-1
  • Testator: A male person who leaves a will at death.
  • Trustee: A person or institution holding and administering property in trust.
  • United States: includes the territories thereof and the District of Columbia. See Alabama Code 1-1-1
(2) ASCERTAINABLE STANDARD. A standard relating to an individual’s health, education, support, or maintenance within the meaning of 26 U.S.C. § 2041(b)(1)(A), as amended, or 26 U.S.C. § 2514(c)(1), as amended, and any applicable regulations.
(3) AUTHORIZED FIDUCIARY.

(A) A trustee or other fiduciary, other than a settlor, that has the discretion to distribute or direct a trustee to distribute part or all of the principal of the first trust to one or more current beneficiaries;
(B) a special fiduciary appointed under Section 19-3D-9; or
(C) a special-needs fiduciary under Section beneficiary with disability” class=”unlinked-ref” datatype=”S” sessionyear=”2021″ statecd=”AL” title=”19″>19-3D-13.
(4) BENEFICIARY. A person that:

(A) has a present or future, vested or contingent, beneficial interest in a trust;
(B) holds a power of appointment over trust property; or
(C) is an identified charitable organization that will or may receive distributions under the terms of the trust.
(5) CHARITABLE INTEREST. An interest in a trust which:

(A) is held by an identified charitable organization and makes the organization a qualified beneficiary;
(B) benefits only charitable organizations and, if the interest were held by an identified charitable organization, would make the organization a qualified beneficiary; or
(C) is held solely for charitable purposes and, if the interest were held by an identified charitable organization, would make the organization a qualified beneficiary.
(6) CHARITABLE ORGANIZATION.

(A) a person, other than an individual, organized and operated exclusively for charitable purposes; or
(B) a government or governmental subdivision, agency, or instrumentality, to the extent it holds funds exclusively for a charitable purpose.
(7) CHARITABLE PURPOSE. The relief of poverty, the advancement of education or religion, the promotion of health, a municipal or other governmental purpose, or another purpose, the achievement of which is beneficial to the community.
(8) COURT. The court in this state having jurisdiction in matters relating to trusts.
(9) CURRENT BENEFICIARY. A beneficiary that on the date the beneficiary’s qualification is determined is a distributee or permissible distributee of trust income or principal. The term includes the holder of a presently exercisable general power of appointment but does not include a person that is a beneficiary only because the person holds any other power of appointment.
(10) DECANTING POWER. The power of an authorized fiduciary under this chapter to distribute property of a first trust to one or more second trusts or to modify the terms of the first trust.
(11) EXPANDED DISTRIBUTIVE DISCRETION. A discretionary power of distribution that is not limited to an ascertainable standard or a reasonably definite standard.
(12) FIRST TRUST. A trust over which an authorized fiduciary may exercise the decanting power.
(13) FIRST-TRUST INSTRUMENT. The trust instrument for a first trust.
(14) GENERAL POWER OF APPOINTMENT. A power of appointment exercisable in favor of a powerholder, the powerholder’s estate, a creditor of the powerholder, or a creditor of the powerholder’s estate.
(15) JURISDICTION. With respect to a geographic area, includes a state or country.
(16) PERSON. An individual, estate, business or nonprofit entity, public corporation, government or governmental subdivision, agency, or instrumentality, or other legal entity.
(17) POWER OF APPOINTMENT. A power that enables a powerholder acting in a nonfiduciary capacity to designate a recipient of an ownership interest in or another power of appointment over the appointive property. The term does not include a power of attorney.
(18) POWERHOLDER. A person in which a donor creates a power of appointment.
(19) PRESENTLY EXERCISABLE POWER OF APPOINTMENT. A power of appointment exercisable by the powerholder at the relevant time. The term:

(A) includes a power of appointment exercisable only after the occurrence of a specified event, the satisfaction of an ascertainable standard, or the passage of a specified time only after:

(i) the occurrence of the specified event;
(ii) the satisfaction of the ascertainable standard; or
(iii) the passage of the specified time; and
(B) does not include a power exercisable only at the powerholder’s death.
(20) QUALIFIED BENEFICIARY. A beneficiary that on the date the beneficiary’s qualification is determined:

(A) to be a distributee or permissible distributee of trust income or principal;
(B) would be a distributee or permissible distributee of trust income or principal if the interests of the distributees described in subparagraph (A) terminated on that date, but the termination of those interests would not cause the trust to terminate; or
(C) would be a distributee or permissible distributee of trust income or principal if the trust terminated on that date.
(21) REASONABLY DEFINITE STANDARD. A clearly measurable standard under which a holder of a power of distribution is legally accountable within the meaning of 26 U.S.C. § 674(b)(5)(A), as amended, and any applicable regulations.
(22) RECORD. Information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
(23) SECOND TRUST.

(A) a first trust after modification under this chapter; or
(B) a trust to which a distribution of property from a first trust is or may be made under this chapter.
(24) SECOND-TRUST INSTRUMENT. The trust instrument for a second trust.
(25) SETTLOR. Except as otherwise provided in Section 19-3D-25, a person, including a testator, that creates or contributes property to a trust. If more than one person creates or contributes property to a trust, each person is a settlor of the portion of the trust property attributable to the person’s contribution except to the extent another person has power to revoke or withdraw that portion.
(26) SIGN. With present intent to authenticate or adopt a record:

(A) to execute or adopt a tangible symbol; or
(B) to attach to or logically associate with the record an electronic symbol, sound, or process.
(27) STATE. A state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States.
(28) TERMS OF THE TRUST. The manifestation of the settlor’s intent regarding a trust’s provisions as expressed in the trust instrument, as may be established by other evidence that would be admissible in a judicial proceeding, or as may be established by court order or nonjudicial settlement agreement.
(29) TRUST INSTRUMENT. A record executed by the settlor to create a trust or by any person to create a second trust which contains some or all of the terms of the trust, including any amendments.
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