Kentucky Statutes 386B.5-050 – Overdue distribution
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(1) As used in this section, “mandatory distribution” means a distribution of income or principal which the trustee is required to make to a beneficiary under the terms of the trust, including a distribution on termination of the trust. The term shall not include a distribution subject to the exercise of the trustee‘s discretion even if:
(a) The discretion is expressed in the form of a standard of distribution; or
(b) The terms of the trust authorizing a distribution couple language of discretion with language of direction.
(2) Whether or not a trust contains a spendthrift provision, a creditor or assignee of a beneficiary may reach a mandatory distribution of income or principal, including a distribution on termination of the trust, if the trustee has not made the distribution to the beneficiary within a reasonable time after the designated distribution date.
Effective: July 15, 2014
History: Created 2014 Ky. Acts ch. 25, sec. 44, effective July 15, 2014.
(a) The discretion is expressed in the form of a standard of distribution; or
Terms Used In Kentucky Statutes 386B.5-050
- 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
- Beneficiary: means a person that:
(a) Has a present or future beneficial interest in a trust, vested or contingent. See Kentucky Statutes 386B.1-010 - Spendthrift provision: means a term of a trust which restrains both voluntary and involuntary transfer of a beneficiary's interest. See Kentucky Statutes 386B.1-010
- Trust: means an express trust established by a trust instrument, including a will, whereby a trustee has the duty to administer a trust asset for the benefit of a named or otherwise described income or principal beneficiary, or both. See Kentucky Statutes 386B.1-010
- Trustee: A person or institution holding and administering property in trust.
- Trustee: includes an original, additional, and successor trustee, and a cotrustee. See Kentucky Statutes 386B.1-010
(b) The terms of the trust authorizing a distribution couple language of discretion with language of direction.
(2) Whether or not a trust contains a spendthrift provision, a creditor or assignee of a beneficiary may reach a mandatory distribution of income or principal, including a distribution on termination of the trust, if the trustee has not made the distribution to the beneficiary within a reasonable time after the designated distribution date.
Effective: July 15, 2014
History: Created 2014 Ky. Acts ch. 25, sec. 44, effective July 15, 2014.