District Of Columbia Council Bill B25-0224 Introduced / Bill

                     
 
Government of the District of Columbia 
UNIFORM LAW COMMISSION 
 
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March 16, 2023 
 
The Honorable Phil Mendelson 
Chairman 
Council of the District of Columbia 
The John A. Wilson Building, 
1350 Pennsylvania Avenue, NW  
Washington, DC 20004 
 
RE: Request for introduction of the Uniform Trust Decanting Act of 2023. 
 
Dear Chairman Mendelson: 
 
 Pursuant to Rule 401(b)(1) of the Rules of Organization and Procedure for the 
Council, this is to request, on behalf of the District of Columbia Uniform Law 
Commission, that you introduce the proposed “Uniform Trust Decanting Act of 2023.”  
This Act is one of three related uniform acts concerning trusts that are being transmitted 
today. 
 
 The Uniform Trust Decanting Act provides clear rules for a trustee’s distribution 
of assets from one irrevocable trust to another irrevocable trust.  Decanting can be used 
for many purposes, including to address changed circumstances that were not anticipated 
by settlor who created the trust.  Examples include conforming the trust to the 
requirements of a supplemental needs trust for a beneficiary who becomes disabled; to 
change the situs of the trust; to combine trusts for greater efficiency; and to avoid adverse 
tax consequences.   
 
The Act (1) provides clear statutory rules replacing often murky common-law 
decisions; (2) provides appropriate limits on a trustee’s ability to decant to ensure that the 
settlor’s intent is carried out; (3) protects beneficiaries by requiring notice and protecting 
all vested interests; (4) provides that charitable interests may not be reduced or 
eliminated; and (5) protects successor trustees from liability for a previous trustee’s 
decanting by allowing a trustee that assumes management of a previously decanted trust 
to rely on the validity of the previous decanting, without risk of incurring liability for the 
previous trustee’s actions.  The Act makes decanting easier and safer.  For example, a 
trustee may “decant” by restating the existing trust document, avoiding the need to draft 
an entirely new trust and apply for a new tax identification number when only a small 
administrative change is intended.   2 
 
 
 The Uniform Trust Decanting Act was completed by the National Conference of 
Commissioners on Uniform State Laws in 2015. Is has been enacted in 13 states, 
including Virginia, and has been introduced in an additional three states this year. 
 
 A proposed “Uniform Trust Decanting Act of 2023” is being filed with this letter. 
In addition, the following documents have been filed:  (1) a summary of the Uniform 
Trust Decanting Act; (2) a statement as to why the Uniform Trust Decanting Act should 
be adopted; and (3) the official version of the Uniform Trust Decanting Act, with 
comments. 
 
 I would be pleased to answer any questions and to provide any additional 
information requested. 
 
 Sincerely, 
 
 
 
 
 
 
 James C. McKay, Jr. 
 Chair 
 D.C. Uniform Law Commission 
 
cc:  Uniform Law Commissioners   ~obernment of tbt 3Bi•trtct of €olumbia 
UNIFORM LAW COMMISSION 
The Honorable Phil Mendelson 
Chairman 
Council 
of the District of Columbia 
The John 
A. Wilson Building, 
1350 Pennsylvania Avenue, 
NW 
Washington, DC 20004 
*** 
March 16, 2023 
RE: Request for introduction 
of the Uniform Trust Decanting Act 	of 2023. 
Dear Chairman Mendelson: 
Pursuant to Rule 
401 (b )( 1) of the Rules of Organization and Procedure for the 
Council, this 
is to request, on behalf of the District of Columbia Uniform Law 
Commission, that you introduce the proposed "Uniform Trust Decanting Act 
of 2023." 
This Act 
is one of three related uniform acts concerning trusts that are being transmitted 
today. 
The Uniform Trust Decanting Act provides clear rules for a trustee's distribution 
of assets from one irrevocable trust to another irrevocable trust. Decanting can be used 
for many purposes, including to address changed circumstances that were not anticipated 
by settlor who created the trust. Examples include conforming the trust to the 
requirements 
of a supplemental needs trust for a beneficiary who becomes disabled; to 
change the situs 
of the trust; to combine trusts for greater efficiency; and 	to avoid adverse 
tax consequences. 
The Act (1) provides clear statutory rules replacing often murky common-law 
decisions; (2) provides appropriate limits on a trustee's ability 
to decant to ensure that the 
settlor's intent is carried out; (3) protects beneficiaries by requiring notice and protecting 
all vested interests; ( 
4) provides that charitable interests may not be reduced or 
eliminated; and ( 
5) protects successor trustees from liability for a previous trustee's 
decanting by allowing a trustee that assumes management 
of a previously decanted trust 
to rely on the validity 
of the previous decanting, without risk 	of incurring liability for the 
previous trustee's actions. The Act makes decanting easier and safer. For example, a 
trustee may "decant" by restating the existing trust document, avoiding the need to draft 
an entirely new trust and apply for a new tax identification number when only a small 
administrative change is intended.   The Uniform Trust Decanting Act was completed 	by the National Conference of 
Commissioners on Uniform State Laws in 2015. Is has been enacted in 	13 states, 
including Virginia, and has been introduced in an additional three states this year. 
A proposed "Uniform Trust Decanting Act 
of 2023" is being filed with this letter. 
In addition, the following documents have been filed: ( 
1) a summary of the Uniform 
Trust Decanting Act; (2) a statement as to why the Uniform Trust Decanting Act should 
be adopted; and (3) the official version 
of the Uniform Trust Decanting Act, with 
comments. 
I would be pleased to answer any questions and to provide any additional 
information requested. 	' 
cc: Uniform Law Commissioners 
2 
Sincerely, 
James C. McKay, Jr. 
Chair 
D.C. Uniform Law Commission   2 
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9 
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12 
13 
n Phil Mendelson at the request 	of the 
District 
of Columbia Uniform Law Commission 
A BILL 
14 	IN THE COUNCIL OF THE DISTRICT OF COLUMBIA 
15 
16 To amend Title 19 of the District of Columbia Official Code by adding a new Chapter 	19 to 
17 enact the Uniform Trust Decanting Act 	to provide clear rules pursuant to which a trustee, 
18 acting in accordance with fiduciary duties, may modify the terms 	of a trust to address 
19 unanticipated changes in beneficiary circumstances and other changes to effectuate the 
20 settlor's general intent; to provide appropriate limits on a trustee's ability to decant; to 
21 protect beneficiaries by requiring notice and providing that their interests may not be 
22 reduced; to protect charitable interests by providing that they may not be reduced and 
23 requiring notice of a protect decanting to the Attorney General; to protect trustees from 
24 liability from a previous trustee's decanting; and for other purposes. 
25 
26 
BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this 
27 act may be cited as the "Uniform Trust Decanting Act 	of 2023." 
28 Sec. 2. Title 19 of the District of Columbia Official Code is amended 	as follows: 
29 (a) The table of contents is amended by adding the following new chapter reference: 
30 "19. Uniform Trust Decanting Act." 
31 (b) The following new chapter is added to read as follows: 
32 	"Chapter 19. Uniform Trust Decanting Act 
33 "Sec. 
34 "19-1901. Short title. 
35 "19-1902. Definitions. 
36 "19-1903. Scope.   37 "19-1904. Fiduciary duty. 
38 "19-1905. Application; governing law. 
39 "19-1906. Reasonable reliance. 
40 "19-1907. Notice; exercise of decanting power. 
41 "19-1908. Representation. 
42 "19-1909. Court involvement. 
43 "19-1910. Formalities. 
44 "19-1911. Decanting power under expanded distributive discretion. 
45 "19-1912. Decanting power under limited distributive discretion. 
46 "19-1913. Trust for beneficiary with disability. 
47 "19-1914. Protection of charitable interest. 
48 "19-1915. Trust limitation on decanting. 
49 "19-1916. Change in compensation. 
50 "19-1917. Relief from liability and indemnification. 
51 "19-1918. Removal or replacement 	of authorized fiduciary. 
52 "19-1919. Tax-related limitations. 
53 "19-1920. Duration of second trust. 
54 "19-1921. Need to distribute not required. 
55 "19-1922. Saving provision. 
56 "19-1923. Trust for care 	of animal. 
57 "19-1924. Terms of second trust. 
58 "19-1925. Settlor. 
59 "19-1926. Later-discovered property. 
2   83 	"(C) Is an identified charitable organization that will or may receive distributions 
84 under the terms of the trust. 
85 "( 6) "Charitable interest" means an interest in a trust which: 
86 	"(A) Is held by an identified charitable organization and makes the organization a 
87 qualified beneficiary; 
88 	"(B) Benefits only charitable organizations and, 	if the interest were held by an 
89 identified charitable organization, would make the organization a qualified beneficiary; or 
90 	"(C) Is held solely for charitable purposes and, 	if the interest were held by an 
91 identified charitable organization, would make the organization a qualified beneficiary. 
92 "(7) "Charitable organization" means: 
93 	"(A) A person, other than an individual, organized and operated exclusively for 
94 charitable purposes; or 
95 	"(B) A government or governmental subdivision, agency, or instrumentality, to 
96 the extent it holds funds exclusively for a charitable purpose. 
97 "(8) "Charitable purpose" means the relief 	of poverty, the advancement of education or 
98 religion, the promotion of health, a municipal or other governmental purpose, or another purpose 
99 the achievement of which is beneficial to the community. 
100 "(9) "Court" means the Superior Court 	of the District of Columbia. 
101 "(10) "Current beneficiary" means a beneficiary that on the date the beneficiary's 
102 qualification is determined is a distributee or permissible distributee 	of trust income or principal. 
103 The term includes the holder 	of a presently exercisable general power 	of appointment but does 
104 not include a person that 	is a beneficiary only because the person holds any other power 	of 
105 appointment. 
4   I 06 "( 11) "Decanting power" or "the decanting power" means the power 	of an authorized 
107 fiduciary under this chapter to distribute property 	of a first trust to one or more second trusts or 
108 to modify the terms of the first trust. 
109 "(12) "District" means the District 	of Columbia. 
110 "(13) "Expanded distributive discretion" means a discretionary power 	of distribution that 
111 is not limited to an ascertainable standard or a reasonably definite standard. 
112 "(14) "First trust" means a trust over which an authorized fiduciary may exercise the 
113 decanting power. 
114 "( 15) "First-trust instrument" means the trust instrument for a first trust. 
115 "( 16) "General power of appointment" means a power 	of appointment exercisable in 
116 favor of a powerholder, the powerholder's estate, a creditor 	of the powerholder, or a creditor 	of 
117 the powerholder's estate. 
118 "(17) "Jurisdiction", with respect 	to a geographic area, includes a state or country. 
119 "(18) "Person" means an individual, estate, business or nonprofit entity, public 
120 corporation, government or governmental subdivision, agency, or instrumentality, or other legal 
121 entity. 
122 "(19) "Power of appointment" means a power that enables a powerholder acting in a 
123 nonfiduciary capacity to designate a recipient of an ownership interest in or another power 	of 
124 appointment over the appointive property. The term does not include a power 	of attorney. 
125 "(20) "Powerholder" means a person in which a donor creates a power 	of appointment. 
126 "(21) "Presently exercisable power 	of appointment" means a power 	of appointment 
127 exercisable by the powerholder at the relevant time. 
5   128 	"(A) The term includes a power 	of appointment exercisable only after the 
129 occurrence of a specified event, the satisfaction 	of an ascertainable standard, or the passage 	of a 
130 specified time only after: 
131 	"(i) The occurrence of the specified event; 
132 	"(ii) The satisfaction of the ascertainable standard; or 
133 	"(iii) The passage of the specified time. 
134 	"(B) The term does not include a 	power exercisable only at the powerholder's 
135 death. 
136 "(22) "Qualified beneficiary" means a beneficiary that 	on the date the beneficiary's 
137 qualification is determined: 
138 	"(A) Is a distributee or permissible distributee 	of trust income or principal; 
139 	"(B) Would be a distributee or permissible distributee 	of trust income or principal 
140 if the interests of the distributees described in subparagraph (A) terminated on that date without 
141 causing the trust to terminate; or 
142 	"(C) Would be a distributee or permissible distributee 	of trust income or principal 
143 if the trust terminated on that date. 
144 "(23) "Reasonably definite standard" means a clearly measurable standard under which a 
145 holder of a power of distribution is legally accountable within the meaning 	of 26 U.S.C. § 
146 674(b)(5)(A) and any applicable regulations. 
147 "(24) "Record" means information that is inscribed on a tangible medium or that is stored 
148 in an electronic or other medium and is retrievable in perceivable form. 
149 "(25) "Second trust" means: 
150 	"(A) A first trust after modification under this chapter; or 
6   151 	"(B) A trust to which a distribution 	of property from a first trust is or may be 
152 made under this chapter. 
153 "(26) "Second-trust instrument" means the trust instrument for a second trust. 
154 "(27) "Settlor", except as otherwise provided 	in§ 19-1925, means a person, including a 
155 testator, that creates or contributes property to a trust. 	If more than one person creates or 
156 contributes property to a trust, each person 	is a settlor of the portion of the trust property 
157 attributable to the person's contribution except to the extent another person has power to revoke 
158 or withdraw that portion. 
159 "(28) "Sign" means, with present intent to authenticate or adopt a record: 
160 	"(A) To execute or adopt a tangible symbol; or 
161 	"(B) To attach to or logically associate with the record an electronic symbol, 
162 sound, or process. 
163 "(29) "State" means a state 	of the United States, the District, Puerto Rico, the United 
164 States Virgin Islands, or any territory or insular possession subject to the jurisdiction 	of the 
165 United States. 
166 "(30) "Terms of a trust" means: 
167 	"(A) Except as otherwise provided in subparagraph (B), the manifestation 	of the 
168 settlor's intent regarding a trust's provisions as: 
169 	"(i) Expressed in the trust instrument; or 
170 	"(ii) Established by other evidence that would be admissible in a judicial 
1 71 proceeding; or 
172 	"(B) The trust's provisions as established, determined, or amended by: 
173 	"(i) A trustee or trust director in accordance with applicable law; 
7   174 	"(ii) Court order; or 
175 	"(iii) A nonjudicial settlement agreement under 	§ 19-1301.11. 
176 "(31) 'Trust instrument" means a record executed by the settlor 	to create a trust or by any 
177 person to create a second trust which contains some or all 	of the terms of the trust, including any 
178 amendments. 
179 "§ 19-1903. Scope. 
180 "(a) Except as otherwise provided in subsections (b) and ( 	c) of this section, this chapter 
181 applies to an express trust that 	is irrevocable or revocable by the settlor only with the consent 	of 
182 the trustee or a person holding an adverse interest. 
183 "(b) This chapter does not apply 	to a trust held solely for charitable purposes. 
184 "( c) Subject to § 19-1915, a trust instrument may restrict or prohibit exercise 	of the 
185 decanting power. 
186 "(d) This chapter does not limit the power 	of a trustee, powerholder, or other person to 
187 distribute or appoint property in further trust or 	to modify a trust under the trust instrument, law 
188 of the District other than this chapter, common law, a court order, or a nonjudicial settlement 
189 agreement. 
190 "( e) This chapter does not affect the ability 	of a settlor to provide in a trust instrument for 
191 the distribution of the trust property or appointment in further trust 	of the trust property or for 
192 modification of the trust instrument. 
193 "§ 19-1904. Fiduciary duty. 
194 "(a) In exercising the decanting power, an authorized fiduciary shall act in accordance 
195 with its fiduciary duties, including the duty 	to act in accordance with the purposes 	of the first 
196 trust. 
8   197 "(b) This chapter does not create or imply a duty to exercise the decanting power or 	to 
198 inform beneficiaries about the applicability 	of this chapter. 
199 "( c) Except as otherwise provided in a first-trust instrument, for purposes 	of this chapter 
200 and §§ 19-1308.01 and 19-1308.02(a), the terms 	of the first trust are deemed to include the 
201 decanting power. 
202 "§ 19-1905. Application; governing law. 
203 'This chapter applies to a trust created before, on, or after the effective date 	of this 
204 chapter which: 
205 "( 1) Has its principal place of administration in the District, including a trust whose 
206 principal place of administration has been changed to the District; or 
207 "(2) Provides by its trust instrument that it 	is governed by the law of the District or is 
208 governed by the law of the District for the purpose of: 
209 	"(A) Administration, including administration 	of a trust whose governing law for 
21 o purposes of administration has been changed to the law 	of the District; 
211 	"(B) Construction of terms of the trust; or 
212 	"( C) Determining the meaning or effect 	of terms of the trust. 
213 "§ 19-1906. Reasonable reliance. 
214 "A trustee or other person that reasonably relies on the validity 	of a distribution of part or 
215 all of the property of a trust to another trust, or a modification 	of a trust, under this chapter, law 
216 of the District other than this chapter, or the law 	of another jurisdiction is not liable to any person 
21 7 for any action or failure to act as a result 	of the reliance. 
218 § 19-1907. Notice; exercise of decanting power. 
9   219 "(a) In this section, a notice period begins on the day notice is given under subsection (c) 
220 of this section and ends 59 days after the day notice 	is given. 
221 "(b) Except as otherwise provided in this chapter, an authorized fiduciary may exercise 
222 the decanting power without the consent 	of any person and without court approval. 
223 "( c) Except as otherwise provided in subsection ( 	t) of this section, an authorized fiduciary 
224 shall give notice in a record 	of the intended exercise of the decanting power not later than 60 
225 days before the exercise to: 
226 	"(1) Each settler of the first trust, ifliving or then in existence; 
227 	"(2) Each qualified beneficiary of the first trust; 
228 	"(3) Each holder of a presently exercisable power 	of appointment over any part or 
229 all of the first trust; 
230 	"( 4) Each person that currently has the right to remove or replace the authorized 
231 fiduciary; 
232 	"( 5) Each other fiduciary of the first trust; 
233 	"( 6) Each fiduciary of the second trust; and 
234 	"(7) The Attorney General, if§ 19-19 l 4(b) applies. 
235 "( d) An authorized fiduciary is not required to give notice under subsection ( 	c) to a 
236 qualified beneficiary who is a minor and has no representative or to a person that is not known to 
23 7 the fiduciary or is known to the fiduciary but cannot be located by the fiduciary after reasonable 
238 diligence. 
239 "( e) A notice under subsection ( c) 	of this section must: 
240 	"(1) Specify the manner in which the authorized fiduciary intends to exercise the 
241 decanting power;   242 	"(2) Specify the proposed effective date for exercise 	of the power; 
243 	"(3) Include a copy of the first-trust instrument; and 
244 	"( 4) Include a copy of all second-trust instruments. 
245 "( f) The decanting power may be exercised before expiration 	of the notice period under 
246 subsection (a) of this section if all persons entitled to receive notice waive the period in a signed 
24 7 - record. 
248 "(g) The receipt of notice, waiver of the notice period,· or expiration 	of the notice period 
249 does not affect the right of a person to file an application under § 19-1909 asserting that: 
250 	"(1) An attempted exercise of the decanting power is ineffective because it did not 
251 comply with this chapter or was an abuse 	of discretion or breach of fiduciary duty; or 
252 	"(2) § 19-1922 applies to the exercise of the decanting power. 
253 "(h) An exercise of the decanting power is not ineffective because of the failure to give 
254 notice to one or more persons under subsection ( 	c) of this section if the authorized fiduciary 
255 acted with reasonable care to comply with subsection ( c) 	of this section. 
256 "§ 19-1908. Representation. 
257 "(a) Notice to a person with authority to represent and bind another person under a first-
258 trust instrument or Chapter 	13 of this title has the same effect 	as notice given directly to the 
259 person represented. 
260 "(b) Consent of or waiver by a person with authority to represent and bind another person 
261 under a first-trust instrument or Chapter 	13 of this title is binding on the person represented 
262 unless the person represented objects to the representation before the consent or waiver 
263 otherwise would become effective. 
11   264 "( c) A person with authority to represent and bind another person under a first-trust 
265 instrument or Chapter 13 of this title may file an application under 	§ 19-1909 on behalf of the 
266 person represented. 
267 "( d) A settlor may not represent or bind a beneficiary under this chapter. 
268 "§ 19-1909. Court involvement. 
269 "(a) On application of an authorized fiduciary a person entitled to notice under § 19-
270 1907(c), a beneficiary, or with respect to a charitable interest the Attorney General or other 
271 person that has standing to enforce the charitable interest, the court may: 
272 	"( 1) Provide instructions to the authorized fiduciary regarding whether a proposed 
273 exercise of the decanting power is permitted under this chapter and consistent with the fiduciary 
274 duties of the authorized fiduciary; 
275 	"(2) Appoint a special fiduciary and authorize the special fiduciary 	to determine 
276 whether the decanting power should be exercised under this chapter and to exercise the decanting 
277 power; 
278 	"(3) Approve an exercise of the decanting power; 
279 	"( 4) Determine that a proposed or attempted exercise 	of the decanting power is 
280 ineffective because: 
281 	"(A) After applying § 19-1922, the proposed or attempted exercise does 
282 not or did not comply with this chapter; or 
283 	"(B) The proposed or attempted exercise would be or was an abuse 	of the 
284 fiduciary's discretion or a breach 	of fiduciary duty; 
285 	"( 5) Determine the extent to which 	§ 19-1922 applies to a prior exercise 	of the 
286 decanting power; 
12   287 	"( 6) Provide instructions to the trustee regarding the application 	of§ 19-1922 to a 
288 prior exercise of the decanting power; or 
289 	"(7) Order other relief to carry out the purposes 	of this chapter. 
290 "(b) On application of an authorized fiduciary, the court may approve: 
291 "(l) An increase in the fiduciary's compensation under§ 19-1916; or 
292 	"(2) A modification under § 19-1918 	of a provision granting a person the right to 
293 remove or replace the fiduciary. 
294 "§ 19-1910. Formalities. 
295 "An exercise of the decanting power must be made in a record signed by an authorized 
296 fiduciary. The signed record must, directly or by reference to the notice required 	by§ 19-1907, 
297 identify the first trust and the second trust or trusts and state the property 	of the first trust being 
298 distributed to each second trust and the property, 	if any, that remains in the first trust. 
299 § 19-1911. Decanting power under expanded distributive discretion. 
300 "( a) In this section: 
301 	"(1) "Non contingent right" means a right that 	is not subject to the exercise of 
302 discretion or the occurr~nce of a specified event that is not certain 	to occur. The term does not 
303 include a right held by a beneficiary 	if any person has discretion to distribute property subject to 
304 the right to any person other than the beneficiary or the beneficiary's estate. 
305 	"(2) "Presumptive remainder beneficiary" means a qualified beneficiary other 
306 than a current beneficiary. 
307 	"(3) "Successor beneficiary" means a beneficiary that 	is not a qualified 
308 beneficiary on the date the beneficiary's qualification 	is determined. The term does not include a 
309 person that is a beneficiary only because the person holds a nongeneral power 	of appointment. 
13   31 o "( 	4) "Vested interest" means: 
311 	"(A) A right to a mandatory distribution that 	is a noncontingent right as 	of 
312 the date of the exercise of the decanting power; 
313 	"(B) A current and noncontingent right, annually or more frequently, to a 
314 mandatory distribution of income, a specified dollar amount, or a percentage 	of value of some or 
315 all of the trust property; 
316 	"(C) A current and noncontingent right, annually or more frequently, to 
317 withdraw income, a specified dollar amount, or a percentage 	of value of some or all of the trust 
318 property; 
319 	"(D) A presently exercisable general power 	of appointment; or 
320 	"(E) A right to receive an ascertainable part of the trust property on the 
321 trust's termination which 	is not subject to the exercise of discretion or to the occurrence 	of a 
322 specified event that is not certain to occur. 
323 "(b) Subject to subsection ( c) of this section and § 19-1914, an authorized fiduciary that 
324 has expanded distributive discretion over the principal 	of a first trust for the benefit of one or 
325 more current beneficiaries may exercise the decanting power over the principal 	of the first trust. 
326 "(c) Subject to § 19-1913, in an exercise of the decanting power under this section, a 
327 second trust may not: 
328 	"( 1) Include as a current beneficiary a person that 	is not a current beneficiary of 
329 the first trust, except as otherwise provided in subsection ( 	d) of this section; 
330 	"(2) Include as a presumptive remainder beneficiary or successor beneficiary a 
331 person that is not a current beneficiary, presumptive remainder beneficiary, or successor 
332 beneficiary of the first trust, except as otherwise provided in subsection ( d) 	of this section; or 
14   333 	"(3) Reduce or eliminate a vested interest. 
334 "(d) Subject to subsection (c)(3) 	of this section and § 19-1914, in an exercise of the 
335 decanting power under this section, a second trust may be a trust created or administered under 
336 the law of any jurisdiction and may: 
337 	"(1) Retain a power of appointment granted in the first trust; 
338 	"(2) Omit a power of appointment granted in the first trust, other than a presently 
339 exercisable general power 	of appointment; 
340 	"(3) Create or modify a power 	of appointment if the powerholder is a current 
341 beneficiary of the first trust and the authorized fiduciary has expanded distributive discretion to 
342 distribute principal to the beneficiary; and 
343 	"(4) Create or modify a power 	of appointment if the powerholder is a presumptive 
344 remainder beneficiary or successor beneficiary 	of the first trust, but the exercise 	of the power 
345 may take effect only after the powerholder becomes, or would have become 	if then living, a 
346 current beneficiary. 
34 7 "( e) A power of appointment described in subsection ( d)( 	1) through ( 4) of this section 
348 may be general or nongeneral. The class 	of permissible appointees in favor 	of which the power 
349 may be exercised may be broader than or different from the beneficiaries 	of the first trust. 
350 "(f) If an authorized fiduciary has expanded distributive discretion over part but not all 	of 
351 the principal of a first trust, the fiduciary may exercise the decanting power under this section 
352 over that part of the principal over which the authorized fiduciary has expanded distributive 
353 discretion. 
354 § 19-1912. Decanting power under limited distributive discretion. 
15   355 "( a) In this section, "limited distributive discretion" means a discretionary power 	of 
356 distribution that is limited to an ascertainable standard or a reasonably definite standard. 
357 "(b) An authorized fiduciary that has limited distributive discretion over the principal 	of 
358 the first trust for benefit of one or more current beneficiaries may exercise the decanting power 
359 over the principal of the first trust. 
360 "(c) Under this section and subject to 	§ 19-1914, a second trust may be created or 
361 administered under the law 	of any jurisdiction. Under this section, the second trusts, in the 
362 aggregate, must grant each beneficiary 	of the first trust beneficial interests which are 
363 substantially similar to the beneficial interests 	of the beneficiary in the first trust. 
364 "( d) A power to make a distribution under a second trust for the benefit 	of a beneficiary 
365 who is an individual is substantially similar to a power under the first trust to make a distribution 
366 directly to the beneficiary. A distribution is for the benefit 	of a beneficiary if: 
367 	"(1) The distribution is applied for the benefit 	of the beneficiary; 
368 	"(2) The beneficiary is under a legal disability or the trustee reasonably believes 
369 the beneficiary is incapacitated, and the distribution is made as permitted under Chapter 	13 of 
370 this title; or 
371 	"(3) The distribution is made as permitted under the terms 	of the first-trust 
372 instrument and the second-trust instrument for the benefit 	of the beneficiary. 
373 "( e) If an authorized fiduciary has limited distributive discretion over part but not all 	of 
374 the principal of a first trust, the fiduciary may exercise the decanting power under this section 
375 over that part of the principal over which the authorized fiduciary has limited distributive 
376 discretion. 
377 "§ 19-1913. Trust for beneficiary with disability. 
16   378 "(a) In this section: 
3 79 	"( 1) "Beneficiary with a disability" means a beneficiary 	of a first trust who the 
380 special-needs fiduciary believes may qualify for governmental benefits based on disability, 
381 whether or not the beneficiary currently receives those benefits or 	is an individual who has been 
382 adjudicated incompetent. 
383 	"(2) "Governmental benefits" means financial aid or services from a state, federal, 
384 or other public agency. 
385 	"(3) "Special-needs fiduciary" means, with respect to a trust that has a beneficiary 
386 with a disability: 
387 	"(A) A trustee or other fiduciary, other than a settlor, that has discretion to 
388 distribute part or all of the principal of a first trust to one or more current beneficiaries; 
389 	"(B) If no trustee or fiduciary has discretion under subparagraph (A), a 
390 trustee or other fiduciary, other than a settlor, that has discretion to distribute part or all 	of the 
391 income of the first trust to one or more current beneficiaries; or 
392 	"(C) If no trustee or fiduciary has discretion under subparagraphs (A) and 
393 (B), a trustee or other fiduciary, other than a settlor, that 	is required to distribute part or all 	of the 
394 income or principal of the first trust to one or more current beneficiaries. 
395 	"( 4) "Special-needs trust" means a trust the trustee believes would not be 
396 considered a resource for purposes 	of determining whether a beneficiary with a disability is 
397 eligible for governmental benefits. 
398 "(b) A special-needs fiduciary may exercise the decanting power under 	§ 19-1911 over 
399 the principal of a first trust as if the fiduciary had authority to distribute principal 	to a beneficiary 
400 with a disability subject to expanded distributive discretion 	if: 
17   401 	"( 1) A second trust is a special-needs trust that benefits the beneficiary with a 
402 disability; and 
403 	"(2) The special-needs fiduciary determines that exercise 	of the decanting power 
404 will further the purposes of the first trust. 
405 "( c) In an exercise of the decanting power under this section, the following rules apply: 
406 "(l) Notwithstanding § 19-1911(c)(2), the interest in the second trust 	of a 
407 beneficiary with a disability may: 
408 	"(A) Be a pooled trust as defined by Medicaid law for the benefit 	of the 
409 beneficiary with a disability under 	42 U.S.C. § 1396p( d)( 4)(C); or 
410 	"(B) Contain payback provisions complying with reimbursement 
411 requirements of Medicaid law under 42 U.S.C. § 1396p(d)(4)(A). 
412 	"(2) § 19-191 l(c)(3) does not apply 	to the interests of the beneficiary with a 
413 disability. 
414 	"(3) Except as affected by any change to the interests of the beneficiary with a 
415 disability, the second trust, or 	if there are two or more second trusts, the second trusts in the 
416 aggregate, must grant each other beneficiary 	of the first trust beneficial interests in the second 
417 trusts which are substantially similar 	to the beneficiary's beneficial interests in the first trust. 
418 "§ 19-1914. Protection of charitable interest. 
419 "(a) In this section: 
420 	"(1) "Determinable charitable interest" means a charitable interest that is a right to 
421 a mandatory distribution currently, periodically, on the occurrence 	of a specified event, or after 
422 the passage of a specified time and which is unconditional or will be held solely for charitable 
423 - purposes. 
18   424 	"(2) "Unconditional" means not subject to the occurrence 	of a specified event that 
425 1s not certain to occur, other than a requirement in a trust instrument that a charitable 
J 426 organization be in existence or qualify under a particular provision 	of the United States Internal 
427 Revenue Code of 1986 on the date of the distribution, if the charitable organization meets the 
428 requirement on the date of determination. 
429 "(b) If a first trust contains a determinable charitable interest, the Attorney General has 
430 the rights of a qualified beneficiary and may represent and bind the charitable interest. 
431 "( c) If a first trust contains a charitable interest, the second trust or trusts may not: 
432 "(l) Diminish the charitable interest; 
433 	"(2) Diminish the interest of an identified charitable organization that holds the 
434 charitable interest; 
435 	"(3) Alter any charitable purpose stated in the first-trust instrument; or 
436 	"( 4) Alter any condition or restriction related to the charitable interest. 
437 "( d) If there are two or more second trusts, the second trusts shall be treated 	as one trust 
438 for purposes of determining whether the exercise 	of the decanting power diminishes the 
439 charitable interest or diminishes the interest 	of an identified charitable organization for purposes 
440 of subsection ( c) of this section. 
441 "( e) If a first trust contains a determinable charitable interest, the second trust or trusts 
442 that include a charitable interest pursuant to subsection ( 	c) of this section must be administered 
443 under the law of the District unless: 
444 "(l) The Attorney General, after receiving notice under 	§ 19-1907, fails to object 
445 in a signed record delivered to the authorized fiduciary within the notice period; 
19   446 	"(2) The Attorney General consents in a signed record 	to the second trust or trusts 
44 7 being administered under the law 	of another jurisdiction; or 
448 	"(3) The court approves the exercise 	of the decanting power. 
449 "(f) This chapter does not limit the powers and duties 	of the Attorney General under law 
450 of the District other than this chapter. 
451 "§ 19-1915. Trust limitation on decanting. 
452 "(a) An authorized fiduciary may not exercise the decanting power to the extent the first-
453 trust instrument expressly prohibits exercise of: 
454 	"( 1) The decanting power; or 
455 	"(2) A power granted by state law 	to the fiduciary to distribute part or all of the 
456 principal of the trust to another trust or to modify the trust. 
457 "(b) Exercise of the decanting power is subject to any restriction m the first-trust 
458 instrument that expressly applies to exercise 	of: 
459 	"( 1) The decanting power; or 
460 	"(2) A power granted by state law 	to a fiduciary to distribute part or all 	of the 
461 principal of the trust to another trust or to modify the trust. 
462 "( c) A general prohibition of the amendment or revocation of a first trust, a spendthrift 
463 clause, or a clause restraining the voluntary or involuntary transfer 	of a beneficiary's interest 
464 does not preclude exercise of the de 
465 "( d) Subject to subsections (a) and (b) 	of this section, an authorized fiduciary may 
466 exercise the decanting power under this chapter even 	if the first-trust instrument permits the 
467 authorized fiduciary or another person to modify the first-trust instrument or to distribute part or 
468 all of the principal of the first trust to another trust. 
20   469 "( e) If a first-trust instrument contains an express prohibition described in subsection ( 	a) 
4 70 of this section or an express restriction described in subsection (b) 	of this section, the provision 
4 71 must be included in the second-trust instrument. 
472 "§ 19-1916. Change in compensation. 
473 "(a) If a first-trust instrument specifies an authorized fiduciary's compensation, the 
474 fiduciary may not exercise the decanting power to increase the fiduciary's compensation above 
475 the specified compensation unless: 
4 76 "(l) All qualified beneficiaries of the second trust consent to the increase in a 
4 77 signed record; or 
478 	"(2) The increase is approved by the court. 
479 "(b) If a first-trust instrument does not specify an authorized fiduciary's compensation, 
480 the fiduciary may not exercise the decanting power to increase the fiduciary's compensation 
481 above the compensation permitted by Chapter 	13 of this title unless: 
482 	"( 	1) All qualified beneficiaries of the second trust consent to the increase in a 
483 signed record; or 
484 	"(2) The increase is approved by the court. 
485 "(c) A change in an authorized fiduciary's compensation which is incidental to other 
486 changes made by the exercise 	of the decanting power is not an increase in the fiduciary's 
487 compensation for purposes of subsections (a) and (b) 	of this section. 
488 "§ 19-1917. Relief from liability and indemnification. 
489 "( a) Except as otherwise provided in this section, a second-trust instrument may not 
490 relieve an authorized fiduciary from liability for breach 	of trust to a greater extent than the first-
491 trust instrument. 
21   492 "(b) A second-trust instrument may provide for indemnification 	of an authorized 
493 fiduciary of the first trust or another person acting in a fiduciary capacity under the first trust for 
494 any liability or claim that would have been payable from the first trust 	if the decanting power had 
495 not been exercised. 
496 "( c) A second-trust instrument may not reduce fiduciary liability in the aggregate. 
497 "( d) Subject to subsection ( 	c) of this section, a second-trust instrument may divide and 
498 reallocate fiduciary powers among fiduciaries, including one or more trustees, distribution 
499 advisors, investment advisors, trust protectors, or other persons, and relieve a fiduciary from 
500 liability for an act or failur~ 	to act of another fiduciary as permitted by law of the District other 
501 than this chapter. 
502 "§ 19-1918. Removal or replacement 	of authorized fiduciary. 
503 "An authorized fiduciary may not exercise the decanting power 	to modify a provision in a 
504 first-trust instrument granting another person power 	to remove or replace the fiduciary unless: 
505 "( 1) The person holding the power consents to the modification in a signed record and the 
506 modification applies only 	to the person; 
507 "(2) The person holding the power and the qualified beneficiaries 	of the second trust 
508 consent to the modification in a signed record and the modification grants a substantially similar 
509 power to another person; or 
510 "(3) The court approves the modification and the modification grants a substantially 
511 similar power to another person. 
512 "§ 19-1919. Tax-related limitations. 
513 "(a) In this section: 
22   514 	"( 1) "Grantor trust" means a trust as to which a settlor 	of a first trust is considered 
515 the owner under 26 U.S.C. 	§§ 671 through 677 or 26 U.S.C. § 679. 
516 	"(2) "Internal Revenue Code" means the United States Internal Revenue Code 	of 
517 1986. 
518 	"(3) "N ongrantor trust" means a trust that is not a grantor trust. 
519 	"(4) "Qualified benefits property" means property subject to the mm1mum 
520 distribution requirements of 26 U.S.C. § 401(a)(9), and any applicable regulations, 	or to any 
521 similar requirements that refer to 26 U.S.C. § 401(a)(9) 	or the regulations. 
522 "(b) An exercise of the decanting power is subject to the following limitations: 
523 	"(1) If a first trust contains property that qualified, 	or would have qualified but for 
524 provisions of this chapter other than this section, for a marital deduction for purposes 	of the gift 
525 or estate tax under the Internal Revenue Code 	or a state gift, estate, or inheritance tax, the 
526 second-trust instrument must not include 	or omit any term that, if included in or omitted from the 
527 trust instrument for the trust to which the property was transferred, would have prevented the 
528 transfer from qualifying for the deduction, 	or would have reduced the amount 	of the deduction, 
529 under the same provisions of the Internal Revenue Code or state law under which the transfer 
530 qualified. 
531 	"(2) If the first trust contains property that qualified, 	or would have qualified but 
532 for provisions of this chapter other than this section, for a charitable deduction for purposes 	of 
533 the income, gift, or estate tax under the Internal Revenue Code 	or a state income, gift, estate, 	or 
534 inheritance tax, the second-trust instrument must not include 	or omit any term that, if included in 
535 or omitted from the trust instrument for the trust to which the property was transferred, would 
536 have prevented the transfer from qualifying for the deduction, 	or would have reduced the amount 
23   537 of the deduction, under the same provisions of the Internal Revenue Code 	or state law under 
538 which the transfer qualified. 
539 	"(3) If the first trust contains property that qualified, or would have qualified 	but 
540 for provisions of this chapter other than this section, for the exclusion from the gift tax described 
541 in 26 U.S.C. § 2503(b ), the second-trust instrument must not include 	or omit a term that, if 
542 included in or omitted from the trust instrument for the trust to which the property 	was 
543 transferred, would have prevented the transfer from qualifying 	under 26 U.S.C. § 2503(b ). If the 
544 first trust contains property that qualified, or would have qualified but for provisions 	of this 
545 chapter other than this section, for the exclusion from the gift tax described in 26 U.S.C. § 
546 2503(b) by application of 26 U.S.C. § 2503( c ), the second-trust instrument 	must not include or 
547 omit a term that, if included or omitted from the trust instrument for the trust to which the 
548 property was transferred, would have prevented the transfer from qualifying under 26 U.S.C. § 
549 2503( C ). 
550 	"( 4) If the property of the first trust includes shares 	of stock in an S corporation, 
551 as defined in 26 U.S.C. § 1361 and the first trust is, 	or but for provisions of this chapter other 
552 than this section would be, a permitted shareholder under any provision 	of 26 U.S.C. § 1361, an 
553 authorized fiduciary may exercise the power with respect to part or all of the S-corporation stock 
554 only if any second trust receiving the stock is a permitted shareholder under 26 U.S.C. 	§ 
555 1361 ( c )(2). If the property of the first trust includes shares 	of stock in an S corporation and the 
556 first trust is, or but for provisions of this chapter other than this section 	would be, a qualified 
557 subchapter-S trust within the meaning 	of 26 U.S.C. § 136l(d), the second-trust instrument must 
558 not include or omit a term that prevents the second trust from qualifying as a qualified 
559 subchapter-S trust. 
24   560 	"(5) If the first trust contains property that qualified, or would have qualified 	but 
561 for provisions of this chapter other than this section, for a zero inclusion ratio for purposes 	of the 
562 generation-skipping transfer tax under 26 U.S.C. § 2642(c) the second-trust instrument must not 
563 include or omit a term that, if included in or omitted from the first-trust instrument, would have 
564 prevented the transfer to the first trust from qualifying for a zero inclusion ratio under 26 U.S.C. 
565 § 2642( C ). 
566 	"( 6) If the first trust is directly or indirectly the beneficiary 	of qualified benefits 
567 property, the second-trust instrument may not include or omit any term that, 	if included in or 
568 omitted from the first-trust instrument, would have increased the minimum distributions required 
569 with respect to the qualified benefits property under 26 U.S.C. § 401(a)(9) and any applicable 
570 regulations, or any similar requirements that refer to 26 U.S.C. § 401(a)(9) or the regulations. 	If 
571 an attempted exercise of the decanting power violates the preceding sentence, the trustee is 
572 deemed to have held the qualified benefits property and any reinvested distributions 	of the 
573 property as a separate share from the date 	of the exercise of the power and Section 22 § 19-1922 
574 applies to the separate share. 
575 	"(7) If the first trust qualifies as a grantor trust because 	of the application of 26 
576 U.S.C. § 672(f)(2)(A) the second trust 	may not include or omit a term that, 	if included in or 
577 omitted from the first-trust instrument, would have prevented the first trust from qualifying under 
578 26 U.S.C. § 672(f)(2)(A). 
579 	"(8) In this paragraph, "tax benefit" means a federal or state tax deduction, 
580 exemption, exclusion, or other benefit not otherwise listed in this section, except for a benefit 
581 arising from being a grantor trust. Subject to paragraph (9) 	of this subsection, a second-trust 
25   582 instrument may not include or omit a term that, 	if included in or omitted from the first-trust 
583 instrument, would have prevented qualification for a tax benefit 	if: 
584 	"(A) The first-trust instrument expressly indicates an intent 	to qualify for 
585 the benefit or the first-trust instrument clearly is designed to enable the first trust to qualify for 
586 the benefit; and 
587 	"(B) The transfer of property held by the first trust or the first trust 
588 qualified, or but for provisions 	of this chapter other than this section, would have qualified for 
589 the tax benefit. 
590 	"(9) Subject to paragraph (4) of this subsection: 
591 	"(A) Except as otherwise provided in paragraph (7) 	of this subsection, the 
592 second trust may be a nongrantor trust, even 	if the first trust is a grantor trust; and 
593 	"(B) Except as otherwise provided in paragraph (10) 	of this subsection, the 
594 second trust may be a grantor trust, even 	if the first trust is a nongrantor trust. 
595 	"(10) An authorized fiduciary may not exercise the decanting power 	if a settlor 
596 objects in a signed record delivered 	to the fiduciary within the notice period and: 
597 	"(A) The first trust and a second trust are both grantor trusts, in whole or 
598 in part, the first trust grants the settlor or another person the power 	to cause the second trust to 
599 cease to be a grantor trust, and the second trust does not grant an equivalent power 	to the settlor 
600 or other person; or 
601 	"(B) The first trust is a nongrantor trust and a second trust 	is a grantor 
602 trust, in whole or in part, with respect to the settlor, unless: 
603 	"(i) The settlor has the power at all times to cause the second trust 
604 to cease to be a grantor trust; or 
26   605 	"(ii) The first-trust instrument contains a provision granting the 
606 settlor or another person a power that would cause the first trust to cease to be a grantor trust and 
607 the second-trust instrument contains the same provision. 
608 "§ 19-1920. Duration of second trust. 
609 "(a) Subject to subsection (b) 	of this section, a second trust may have a duration that is 
61 o the same as or different from the duration 	of the first trust. 
611 "(b) To the extent that property 	of a second trust is attributable to property of the first 
612 trust, the property of the second trust is subject to any rules governing maximum perpetuity, 
613 accumulation, or suspension of the power of alienation which apply to property 	of the first trust. 
614 "§ 19-1921. Need to distribute not required. 
615 "An authorized fiduciary may exercise the decanting power whether or not under the first 
616 trust's discretionary distribution standard the fiduciary would have made or could have been 
617 compelled to make a discretionary distribution 	of principal at the time of the exercise. 
618 "§ 19-1922. Saving provision. 
619 "(a) If exercise of the decanting power would be effective under this chapter except that 
620 the second-trust instrument in part does not comply with this chapter, the exercise 	of the power is 
621 effective and the following rules apply with respect 	to the principal of the second trust 
622 attributable to the exercise of the power: 
623 	"( 1) A provision in the second-trust instrument which 	is not permitted under this 
624 chapter is void to the extent necessary to comply with this chapter. 
625 	"(2) A provision required by this chapter to be in the second-trust instrument 
626 which is not contained in the instrument is deemed 	to be included in the instrument to the extent 
627 necessary to comply with this chapter. 
27   628 "(b) If a trustee or other fiduciary of a second trust determines that subsection (a) 	of this 
629 section applies to a prior exercise of the decanting power, the fiduciary shall take corrective 
630 action consistent with the fiduciary's duties. 
631 "§ 19-1923. Trustforcareofanimal. 
632 "(a) In this section: 
633 	"( 1) "Animal trust" means a trust or an interest in a trust created to provide for the 
634 care of one or more animals. 
635 	"(2) "Protector" means a person appointed in an animal trust to enforce the trust 
636 on behalf of the animal or, if no such person is appointed in the trust, a person appointed by the 
63 7 court for that purpose. 
638 "(b) The decanting power may be exercised over an animal trust that has a protector to 
639 the extent the trust could be decanted under this chapter 	if each animal that benefits from the 
640 trust were an individual, if the protector consents in a signed record 	to the exercise of the power. 
641 "( c) A protector for an animal has the rights under this chapter 	of a qualified beneficiary. 
642 "(d) Notwithstanding any other provision 	of this chapter, if a first trust is an animal trust, 
643 in an exercise of the decanting power, the second trust must provide that trust property may be 
644 applied only to its intended purpose for the period the first trust benefitted the animal. 
645 "§ 19-1924. Terms of second trust. 
646 "A reference in Chapter 13 of this title to a trust instrument or terms 	of the trust includes 
647 a second-trust instrument and the terms 	of the second trust. 
648 "§ 19-1925. Settlor. 
649 "(a) For purposes of law of the District other than this chapter and subject to subsection 
650 (b) of this section, a settler of a first trust is deemed to be the settler of the second trust with 
28   651 respect to the portion of the principal of the first trust subject to the exercise 	of the decanting 
652 power. 
653 "(b) In determining settlor intent with respect to a second trust, the intent 	of a settlor of 
654 the first trust, a settlor of the second trust, and the authorized fiduciary may be considered. 
655 "§ 19-1926. Later-discovered property. 
656 "( a) Except as otherwise provided in subsection ( 	c) of this section, if exercise of the 
657 decanting power was intended to distribute all the principal 	of the first trust to one or more 
658 second trusts, later-discovered property belonging to the first trust and property paid to or 
659 acquired by the first trust after the exercise 	of the power is part of the trust estate of the second 
660 trust or trusts. 
661 "(b) Except as otherwise provided in subsection ( 	c) of this section, if exercise of the 
662 decanting power was intended to distribute less than all the principal 	of the first trust to one or 
663 more second trusts, later-discovered property belonging to the first trust or property paid to or 
664 acquired by the first trust after exercise 	of the power remains part 	of the trust estate of the first 
665 trust. 
666 "( c) An authorized fiduciary may provide in an exercise 	of the decanting power or by the 
667 terms of a second trust for disposition of later-discovered property belonging 	to the first trust or 
668 property paid to or acquired by the first trust after exercise 	of the power. 
669 "§ 19-1927. Obligations. 
670 "A debt, liability, or other obligation enforceable against property 	of a first trust is 
671 enforceable to the same extent against the property when held by the second trust after exercise 
672 of the decanting power. 
673 "§ 19-1928. Uniformity of application and construction. 
29   674 "In applying and construing this uniform act, consideration must be given 	to the need to 
675 promote uniformity of the law with respect to its subject matter among states that enact it. 
676 "§ 19-1929. Relation to electronic signatures in global and national commerce act. 
677 "This chapter modifies, limits, or supersedes the Electronic Signatures in Global and 
678 National Commerce Act, 	15 U.S.C. § 7001 et seq., but does not modify, limit, or supersede 
679 section l0l(c) of that act, 15 U.S.C. § 7001(c), or authorize electronic delivery 	of any of the 
680 notices described in section 103(b) 	of that act, 15 U.S.C. § 7003(b )." 
681 Sec. 3. Fiscal impact statement. 
682 The Council adopts the fiscal impact statement in the committee report 	as the fiscal 
683 impact statement required by section 602( c )(3) 	of the District of Columbia Home Rule Act, 
684 approved December 24, 1973 (87 Stat. 813; D.C. Official 	Code§ 1-206.02(c)(3)) 
685 Sec. 4. Effective date. 
686 This act shall take effect following approval by the Mayor ( or in the event 	of veto by the 
687 Mayor, action by the Council 	to override the veto), a 30-day period 	of Congressional review as 
688 provided in section 602( c )( 	1) of the District of Columbia Home Rule Act, approved December 
689 24, 1973 (87 Stat. 813; D.C. Official 	Code§ 1-206.02(c)(l)), and publication in the District 	of 
690 Columbia Register. 
30      
 
 
 
 
 
 
The ULC is a nonprofit formed in 1892 to create nonpartisan state legislation. Over 350 volunteer commissioners —lawyers, 
judges, law professors, legislative staff, and others—work together to draft laws ranging from the Uniform Commercial Code to 
acts on property, trusts and estates, family law, criminal law and other areas where uniformity of state law is desirable. 
NATIONAL CONFERENCE OF COM MISSIONERS ON UNIFORM STATE LAWS 
Uniform Law Commission 
111 N. Wabash Ave. 
Suite 1010 
Chicago, IL 60602 
(312) 450- 6600 tel 
(312) 450- 6601 fax 
www.uniformlaws.org 
THE UNIFORM TRUST DECANTING ACT 
 
- A Summary - 
 
“Decanting” is the term used to describe the distribution of assets from one trust into a second 
trust, like wine is decanted from the bottle to another vessel.  Decanting can be a useful strategy 
for changing the outdated terms of an otherwise irrevocable trust, but can also be abused to 
defeat the settlor’s intent.  The Uniform Trust Decanting Act (UTDA) permits decanting for 
appropriate purposes while preventing abuse and preserving the intent of the settlor. 
 
Because decanting is an exercise of the trustee’s discretion and does not require beneficiaries to 
consent, certain tax penalties that would otherwise apply can be avoided.  Every state allows 
decanting in some form, but only some states have statutes governing decanting, and those vary 
widely. 
 
The UTDA includes one stricter set of rules that apply when the settlor gave the trustee limited 
discretion over distributions, and another more liberal set of rules that apply when the trustee has 
expanded discretion.  In both cases, the person exercising the decanting power is subject to all 
applicable fiduciary duties, including the duty to act in accordance with the purposes of the first 
trust. 
 
When the trustee has limited discretion over distributions, decanting is permitted for 
administrative or tax purposes, but the beneficial interests under the second trust instrument must 
be substantially similar to the beneficial interests under the first trust.  In other words, the trustee 
may not exercise the decanting power to reduce or eliminate the interest of any beneficiary.  
However, if the trustee already has expanded discretion to reduce or eliminate the interest of 
beneficiaries under the terms of the first trust, the 	UTDA provides more flexibility. 
 
One common reason for decanting is to provide for a beneficiary who becomes disabled after the 
settlor executed the first trust.  If the settlor did not anticipate the possibility of disability, the 
beneficiary may be ineligible for governmental benefits that would otherwise be available.  
Section 13 of the UTDA gives additional flexibility to trustees with respect to disabled 
beneficiaries. 
 
The UDTA limits decanting when it would defeat a charitable or tax-related purpose of the 
settlor, and Section 14 provides f or prior notice to the state official that is responsible for 
protecting charitable interests.  Section 16 prohibits decanting for the purpose of adjusting trustee 
compensation without the unanimous consent of the beneficiaries or court approval. 
 
In summary, the UDTA provides a more complete set of rules for decanting than currently exists 
in any state.  It is appropriate for states that have adopted the Uniform Trust Code and for states 
that have a non- uniform trust law statute. 
 
For further information a	bout the Uniform Trust Decanting Act, please contact ULC Chief 
Counsel Benjamin Orzeske at (312) 450	-6621 or borzeske@uniformlaws.org.    
 
 
 
 
 
 
 
The ULC is a nonprofit formed in 1892 to create nonpartisan state legislation. Over 350 volunteer commissioners—lawyers, 
judges, law professors, legislative staff, and others—work together to draft laws ranging from the Uniform Commercial Code to 
acts on property, trusts and estates, family law, criminal law and other areas where uniformity of state law is desirable. 
NATIONAL CONFERENCE OF COMMISSIONERS ON UNIFORM STATE LAWS 
Uniform Law Commission 
111 N. Wabash Ave. 
Suite 1010 
Chicago, IL 60602 
(312) 450- 6600 tel 
(312) 450- 6601 fax 
www.uniformlaws.org 
WHY YOUR STATE SHOULD ADOPT THE UNIFORM TRUST DECANTING ACT 
 
“Decanting” is when a trustee distributes assets from one trust to a second trust, like pouring 
wine from the bottle to another vessel.  Its use has been growing in recent years as trustees 
search for ways to modify the terms of an otherwise irrevocable trust due to changed 
circumstances that the settlor did not anticipate.  The Uniform Trust Decanting Act (UTDA) 
provides a set of decanting rules that are designed to further the settlor’s intent, protect the 
beneficiaries’ interests, and prevent abuses by the decanting trustee. It should be enacted in 
every state because: 
 
• UTDA provides certainty of law.  Trusts are already being decanted in every state, 
sometimes under questionable authority based on obscure common-	law decisions.  The 
UTDA provides clear statutory rules.  
 
• UTDA provides appropriate limits on a trustee’s ability to decant. The UTDA contains 
different decanting rules that ensure the settlor’s intent will not be defeated.  One stricter 
set of rules applies to trustees with limited discretion, and one more lenient set of rules 
applies to trustees with expanded discretion.  All trustees are subject to fiduciary duties and 
required to act in accordance with the purposes of the first trust. 
 
• UTDA protects beneficiaries. Under the UTDA, all qualified beneficiaries must receive 
notice 60 days before a proposed decanting.  Anyone who objects to the decanting may ask a court to intervene. Vested interests may not be reduced or eliminated. 
 
• UTDA protects charitable interests. Under the UTDA, a trust held solely for charitable 
purposes may not be decanted.  If the trust contains any determinable charitable interest, that interest may not be reduced or eliminated by a decanting.  The Attorney General must 
be notified of any proposed decanting and may object on behalf of the charity or charities that stand to benefit. 
 
• UTDA protects trustees from liability for a previous trustee’s decanting. The UTDA 
allows a trustee that assumes management of a 	previously decanted trust to rely on the 
validity of the previous decanting without risk of incurring liability for the previous 
trustee’s actions.   
 
• UTDA makes decanting easier and safer. Under the UTDA, a trustee may “decant” by 
restating the existing trust document, avoiding the need to draft an entirely new trust when 
only a small administrative change is intended.  The UTDA also contains 	an innovative 
savings provision that gives effect to valid provisions of a decanting despite any technical 
violations that are later deemed invalid. 
 
For further information about 	the Uniform Trust Decanting Act, please contact ULC Chief 
Counsel Benjamin Orzeske at (312) 450-6621 or borzeske@uniformlaws.org
.                      
 
UNIFORM TRUST DECANTING ACT 
 
 
 
drafted by the 
 
 
 
NATIONAL CONFERENCE OF COMMISSIONERS 
ON UNIFORM STATE LAWS 
 
 
 
and by it 
 
 
 
APPROVED AND RECOMMENDED FOR ENACTMENT 
IN ALL THE STATES 
 
 
at its  
 
 
ANNUAL CONFERENCE 
MEETING IN ITS ONE-HUNDRED-AND-TWENTY-FOURTH YEAR 
WILLIAMSBURG, VIRGINIA 
JULY 10 - JULY 16, 2015 
 
 
 
 
WITH PREFATORY NOTE AND COMMENTS 
 
 
 
 
Copyright © 2015 
By 
NATIONAL CONFERENCE OF COMMISSIONERS 
ON UNIFORM STATE LAWS 
 
 
 
November 14, 2016   ABOUT ULC 
 
The Uniform Law Commission (ULC), also known as National Conference of Commissioners 
on Uniform State Laws (NCCUSL), now in its 124th year, provides states with non-partisan, 
well-conceived and well-drafted legislation that brings clarity and stability to critical areas of 
state statutory law. 
 
ULC members must be lawyers, qualified to practice law. They are practicing lawyers, judges, 
legislators and legislative staff and law professors, who have been appointed by state 
governments as well as the District of Columbia, Puerto Rico and the U.S. Virgin Islands to 
research, draft and promote enactment of uniform state laws in areas of state law where 
uniformity is desirable and practical. 
 
• ULC strengthens the federal system by providing rules and procedures that are consistent 
from state to state but that also reflect the diverse experience of the states. 
 
• ULC statutes are representative of state experience, because the organization is made up 
of representatives from each state, appointed by state government. 
 
• ULC keeps state law up-to-date by addressing important and timely legal issues. 
 
• ULC’s efforts reduce the need for individuals and businesses to deal with different laws 
as they move and do business in different states. 
 
• ULC’s work facilitates economic development and provides a legal platform for foreign 
entities to deal with U.S. citizens and businesses. 
 
• Uniform Law Commissioners donate thousands of hours of their time and legal and 
drafting expertise every year as a public service, and receive no salary or compensation 
for their work. 
 
• ULC’s deliberative and uniquely open drafting process draws on the expertise of 
commissioners, but also utilizes input from legal experts, and advisors and observers 
representing the views of other legal organizations or interests that will be subject to the 
proposed laws. 
 
• ULC is a state-supported organization that represents true value for the states, providing 
services that most states could not otherwise afford or duplicate.                      
UNIFORM TRUST DECANTING ACT 
The Committee appointed by and representing the National Conference of Commissioners on 
Uniform State Laws in preparing this Act consists of the following individuals:  
STANLEY C. KENT, 90 S. Cascade Ave., Suite 1210, Colorado Springs, CO 80903, Chair  
MARY M. ACKERLY, 782 Bantam Rd., P.O. Box 815, Bantam, CT  06750-0815 
TURNEY P. BERRY, 500 W. Jefferson St., Suite 2800, Louisville, KY  40202 
DAVID J. CLARK, 353 Bel Marin Keys Blvd., Suite 1, Novato, CA  94949 
DAVID M. ENGLISH, University of Missouri-Columbia School of Law, 203 Hulston Hall, 
Columbia, MO  65211 
MARC S. FEINSTEIN, 431 N. Phillips Ave., Suite 301, Sioux Falls, SD  57104 
BRADLEY MYERS, University of North Dakota School of Law, 215 Centennial Dr., Room 
201, Stop 9003, Grand Forks, ND  58202-9003 
MARK H. RAMSEY, P.O. Box 309, Claremore, OK  74018-0309 
ROBERT H. SITKOFF, Harvard Law School, 1575 Massachusetts Ave., Cambridge, MA  
 02138 
SUZANNE BROWN WALSH, 185 Asylum St., CityPlace I, 29th Floor, Hartford, CT  06103-
 3469 
SUSAN T. BART, 1 S. Dearborn St., Chicago, IL  60603, Reporter 
 
EX OFFICIO 
HARRIET LANSING, 1 Heather Pl., St. Paul, MN 55102-3017, President 
ELISA WHITE, 419 Natural Resources Dr., Little Rock, AR  72205, Division Chair 
 
AMERICAN BAR ASSOCIATION ADVISORS 
AMY HELLER, 340 Madison Ave., Floor 17, New York, NY  10173-1922, ABA Advisor 
 
EXECUTIVE DIRECTOR 
LIZA KARSAI, 111 N. Wabash Ave., Suite 1010, Chicago, IL 60602, Executive Director 
 
Copies of this act may be obtained from: 
 
NATIONAL CONFERENCE OF COMMISSIONERS 
ON UNIFORM STATE LAWS 
111 N. Wabash Ave., Suite 1010 
Chicago, Illinois  60602 
312/450-6600 
www.uniformlaws.org   UNIFORM TRUST DECANTING ACT 
TABLE OF CONTENTS 
Prefatory Note ................................................................................................................................. 1 
SECTION 1.  SHORT TITLE. ....................................................................................................... 6 
SECTION 2.  DEFINITIONS. ........................................................................................................ 6 
SECTION 3.  SCOPE. .................................................................................................................. 17 
SECTION 4.  FIDUCIARY DUTY. ............................................................................................. 20 
SECTION 5.  APPLICATION; GOVERNING LAW. ................................................................ 22 
SECTION 6.  REASONABLE RELIANCE. ............................................................................... 24 
SECTION 7.  NOTICE; EXERCISE OF DECANTING POWER . ............................................. 25 
[SECTION 8.  REPRESENTATION.] ......................................................................................... 28 
SECTION 9.  COURT INVOLVEMENT. ................................................................................... 30 
SECTION 10.  FORMALITIES. .................................................................................................. 33 
SECTION 11.  DECANTING POWER UNDER EXPANDED DISTRIBUTIVE  
DISCRETION. .................................................................................................................. 34 
SECTION 12.  DECANTING POWER UNDER LIMITED DISTRIBUTIVE DISCRETION. . 41 
SECTION 13.  TRUST FOR BENEFICIARY WITH DISABILITY . ......................................... 44 
SECTION 14.  PROTECTION OF CHARITABLE INTEREST. ............................................... 48 
SECTION 15.  TRUST LIMITATION ON DECANTING. ........................................................ 54 
SECTION 16.  CHANGE IN COMPENSATION. ...................................................................... 56 
SECTION 17.  RELIEF FROM LIABILITY AND INDEMNIFICATION. ............................... 57 
SECTION 18.  REMOVAL OR REPLACEMENT OF AUTHORIZED FIDUCIARY. ............. 59 
SECTION 19.  TAX-RELATED LIMITATIONS. ...................................................................... 60 
SECTION 20.  DURATION OF SECOND TRUST. ................................................................... 69 
SECTION 21.  NEED TO DISTRIBUTE NOT REQUIRED. ..................................................... 71 
SECTION 22.  SAVING PROVISION. ....................................................................................... 72 
SECTION 23.  TRUST FOR CARE OF ANIMAL. .................................................................... 74 
SECTION 24.  TERMS OF SECOND TRUST. .......................................................................... 76 
SECTION 25.  SETTLOR. ........................................................................................................... 76 
SECTION 26.  LATER-DISCOVERED PROPERTY. ................................................................ 77 
SECTION 27.  OBLIGATIONS. .................................................................................................. 79 
SECTION 28.  UNIFORMITY OF APPLICATION AND CONSTRUCTION. ......................... 80 
SECTION 29.  RELATION TO ELECTRONIC SIGNATURES IN GLOBAL AND 
NATIONAL COMMERCE ACT. .................................................................................... 81 
[SECTION 30.  SEVERABILITY.] ............................................................................................. 81 
SECTION 31.  REPEALS; CONFORMING AMENDMENTS. ................................................. 81 
SECTION 32.  EFFECTIVE DATE. ............................................................................................ 81   1 
UNIFORM TRUST DECANTING ACT 
Prefatory Note 
The Uniform Trust Decanting Act is promulgated in the midst of a rising tide of state 
decanting statutes.  These statutes represent one of several recent innovations in trust law that 
seek to make trusts more flexible so that the settlor’s material purposes can best be carried out 
under current circumstances.  A decanting statute provides flexibility by statutorily expanding 
discretion already granted to the trustee to permit the trustee to modify the trust either directly or 
by distributing its assets to another trust.  While some trusts expressly grant the trustee or another 
person a power to modify or decant the trust, a statutory provision can better describe the power 
granted, impose limits on the power to protect the beneficiaries and the settlor’s intent, protect 
against inadvertent tax consequences, provide procedural rules for exercising the power and 
provide for appropriate remedies.  While decanting may be permitted in some situations under 
common law in some states, in many states it is unclear whether common law decanting is 
permitted, and if it is, the circumstances in which it is permitted and the parameters within which 
it may be exercised. 
Need for Uniformity.  Trusts may be governed by the laws of different states for 
purposes of validity, meaning and effect, and administration.  The place of administration of a 
trust may move from state to state.  It often may be difficult to determine the state in which a 
trust is administered if a trust has co-trustees domiciled in different states or has a corporate 
trustee that performs different trust functions in different states.  As a result it may sometimes be 
unclear whether a particular state’s decanting statute applies to a trust and sometimes more than 
one state’s decanting statute may apply to a trust.  A uniform statute can eliminate conflicts 
between different state statutes.  It can also protect a trustee who decants under one state’s statute 
when more than one state’s statute might apply and protect a trustee who reasonably relies on a 
prior decanting. 
Currently there is limited guidance on the income, gift, and generation-skipping transfer 
(“GST”) tax implications of decanting.  A uniform statute also may provide common ground for 
the promulgation of tax guidance. 
What Trusts May Be Decanted.  Generally, the Uniform Trust Decanting Act permits 
decanting of an irrevocable, express trust in which the terms of the trust grant the trustee or 
another fiduciary the discretionary power to make principal distributions.  See Section 3 and 
Section 2(3) (defining “authorized fiduciary”).  The act does not apply to revocable trusts unless 
they are revocable by the settlor only with the consent of the trustee or an adverse party.  Section 
3(a).  The act does not apply to wholly charitable trusts.  Section 3(b).  With one exception, if no 
fiduciary has discretion to distribute principal, the act does not apply unless the court appoints a 
special fiduciary and authorizes the special fiduciary to exercise the decanting power.  See 
Section 9(1)(2).  The exception is that a fiduciary who is responsible for making trust 
distributions may decant a trust to create a special-needs trust even if the fiduciary does not have 
discretion over principal if the decanting will further the purposes of the first trust. 
Who May Decant.  As discussed below, the decanting power is a fiduciary power, and 
thus must be entrusted to one of the fiduciaries of the first trust.  The act entrusts the “authorized   2 
fiduciary” with the decanting power.  The “authorized fiduciary” generally is the fiduciary who 
has discretion to distribute principal, although a more expansive definition is needed in the case 
of a special-needs trust.  Generally, the authorized fiduciary will be the trustee.  Where there is a 
divided trusteeship that gives the power to make or direct principal distributions to another 
fiduciary, such as a distribution director, such other fiduciary will be the authorized fiduciary. 
Discretion Over Principal.  Except in the case of special-needs trusts, the decanting 
power is granted only to an authorized fiduciary who by definition must have the discretion to 
distribute principal.  The extent of the decanting authority depends upon the extent of the 
discretion granted to the trustee to distribute principal.  When the authorized fiduciary has 
“limited distribution discretion” that is constrained by an ascertainable or reasonably definite 
standard, the interests of each beneficiary in the second trust must be substantially similar to such 
beneficiary’s interests in the first trust.  Thus when the authorized fiduciary has limited 
distributive discretion, an exercise of the decanting power generally can modify administrative, 
but not dispositive, trust provisions.  When the authorized fiduciary has “expanded distributive 
discretion,” the authorized fiduciary may exercise the decanting power to modify beneficial 
interests, subject to restrictions to protect interests that are current, noncontingent rights or vested 
remainder interests, to protect qualification for tax benefits and to protect charitable interests. 
Sometimes a trust may have two or more authorized fiduciaries, some of whom have 
limited distributive discretion and some of whom have expanded distributive discretion.  The 
authorized fiduciaries with limited distributive discretion may exercise the decanting power 
under Section 12 and the authorized fiduciaries with expanded distributive discretion may 
exercise the decanting power under Section 11. 
Fiduciary Power.  The Uniform Trust Decanting Act does not impose any duty on the 
authorized fiduciary to exercise the decanting power, but if the authorized fiduciary does 
exercise that power, the power must be exercised in accordance with the fiduciary duties of the 
authorized fiduciary.  See Section 4.  A fiduciary must administer a trust in good faith, in 
accordance with its terms (subject to the decanting power) and purposes, and in the interests of 
the beneficiaries.  An exercise of decanting power must be in accordance with the purposes of 
the first trust.  The purpose of decanting is not to disregard the settlor’s intent but to modify the 
trust to better effectuate the settlor’s broader purposes or the settlor’s probable intent if the settlor 
had anticipated the circumstances at the time of decanting. 
As a fiduciary power, the decanting power may be exercised without consent or approval 
of the beneficiaries or the court, except in the case of a few specific modifications that may 
benefit the fiduciary personally.  Nonetheless, qualified beneficiaries are entitled to notice and 
may petition the court if they believe the authorized fiduciary has breached its fiduciary duty.  
Further, the authorized fiduciary, another fiduciary, a beneficiary, the settlor or, in the case of a 
trust with a charitable interest, the Attorney General or other official who may enforce the 
charitable interest, may petition the court for instructions, appointment of a special fiduciary who 
may exercise the decanting power, approval of an exercise of decanting power, a determination 
that the authorized fiduciary breached its fiduciary duties, a determination that the savings 
provisions in Section 22 apply or a determination that the attempted decanting is invalid. 
Decanting Procedure.  Initially, the power to decant was often considered a derivative of   3 
the power to make a discretionary distribution to a beneficiary.  Under this construct the 
decanting power was exercised by making a distribution from one trust to another, and a second 
trust, separate and distinct from the first trust, was required. 
The Uniform Trust Decanting Act views the decanting power as a power to modify the 
first trust, either by changing the terms of the first trust or by distributing property from the first 
trust to a second trust.  While the act generally modulates the extent of the authorized fiduciary’s 
power to decant according to the degree of discretion granted to the authorized fiduciary over 
principal, the power to decant is distinct from the power to distribute. 
Thus the authorized fiduciary may exercise the decanting power by modifying the first 
trust, in which case the “second trust” is merely the modified first trust.  The decanting 
instrument can, when appropriate, merely identify the specific provisions in the first trust that are 
to be modified and set forth the modified provisions, much like an amendment to a revocable 
trust.  If the decanting power is exercised by modifying the terms of the first trust, the trustee 
could either treat the second trust as a new trust or treat the second trust as a continuation of the 
first trust.  If the second trust is treated as a continuation of the first trust, there should be no need 
to transfer or retitle the trust property.  Further, subject to future tax guidance, if the second trust 
is a continuation of the first trust, there may be no need to treat the first trust as having 
terminated for income tax purposes and no need to obtain a new tax identification number. 
Innovations.  The Uniform Trust Decanting Act contains a number of innovations, in 
addition to borrowing concepts from existing state decanting statutes. 
The act, like some state statutes, intentionally applies broadly to trusts that have their 
principal place of administration in the state, trusts that are governed by the law of the state for 
administration and trusts that are governed by the law of the state for purposes of construction or 
determining meaning or effect.  See Section 5.  By casting a wide net for applicability, questions 
about whether a state’s uniform statute applies to a particular trust may be minimized. 
Further, the act permits a trustee to reasonably rely on a prior decanting under the law of 
the enacting state or a different state.  See Section 6. 
The Uniform Trust Decanting Act also addresses in detail the extent to which charitable 
interests may be modified by decanting.  The act does not permit decanting of wholly charitable 
trusts.  See Section 3.  With respect to charitable interests within trusts, the act protects any 
charitable deduction that may have been taken.  See Section 19(b)(2).  The act also balances 
protecting the settlor’s charitable intent with the need to permit decanting of trusts that include 
contingent charitable interests.  If the first trust contains a charitable interest, the second trust 
cannot diminish the charitable interest, change an identified charitable organization or change the 
charitable purpose.  To ensure that these protections are respected, the Attorney General must 
receive notice of any decanting of a trust with a charitable interest. Further, the Act prohibits 
changing the governing law of trusts containing determinable charitable interests without court 
approval if the Attorney General objects.  See Section 14. 
The act also delineates the role of the court in greater detail than in existing state statutes.  
See Section 9.  While decanting generally does not require court approval, the authorized   4 
fiduciary may wish to seek instructions or approval from the court to confirm that the decanting 
is not an abuse of discretion.  A fiduciary may also wish to seek court instructions as to the effect 
of a prior decanting, particularly if the prior decanting may be in some way flawed.  A few state 
statutes permit a special fiduciary to be appointed to exercise decanting power where the statute 
does not permit the acting trustee to decant.  The act borrows the concept of a special fiduciary 
but does not restrict its use to cases in which the acting trustee is not permitted to decant. 
The Uniform Trust Decanting Act provides a remedy for an imperfect attempted 
decanting, to avoid the uncertainty that would exist if an attempted decanting is later discovered 
to have failed to fully comply with the decanting statute.  Section 22 of the act essentially reads 
out of the second-trust instrument any impermissible provision and reads into the second-trust 
instrument any required provision.  This gives authorized fiduciaries exercising decanting power 
greater comfort that their intent will be implemented and not subject to challenge for an 
inadvertent misstep or technicality. 
The act borrows from some of the state statutes a provision that deals with the disposition 
of later discovered property.  See Section 26.  This provision ensures that if property was not 
retitled at the time of the decanting, it will be owned by the trust that most likely was intended to 
receive it.  The act also includes a provision that recognizes that the liabilities of the first trust 
pass with the trust property to the second trust.  See Section 27.   
Overview of the Act.  Sections 1 through 6 of the act deal with the scope and application 
of the act, fiduciary duty and definitions.  Section 1 names the act.  Section 2 contains 
definitions.  Definitions of terms used only in one Section are found within that Section.  Section 
3 addresses the types of trusts to which the act applies (or does not apply) and Section 5 
describes the connections to the adopting state that are sufficient for a trust to utilize the act.  
Section 4 addresses fiduciary duty in exercising or not exercising the decanting power.  Section 6 
addresses reliance on prior decantings, including decantings performed under other states’ laws. 
Sections 7 through 10 of the act deal with the procedures for exercising the decanting 
power.  Section 7 sets forth the notice requirements for decanting.  Section 8 is an optional 
provision dealing with representation of beneficiaries, including the representation of certain 
charitable interests by the state’s Attorney General or other appropriate official.  Section 9 
describes the authority of the court with respect to decanting.  Section 10 describes the 
formalities for decanting. 
Sections 11 through 23 contain the heart of the decanting power and describe what 
modifications can be made by decanting.  Section 11 delineates the decanting power when the 
authorized fiduciary has expanded distributive discretion and Section 12 delineates the decanting 
power when the authorized fiduciary has limited distributive discretion. 
Section 13 contains special rules to facilitate decanting into a special-needs trust for a 
beneficiary with a disability.  The Uniform Trust Decanting Act permits a trust to be decanted to 
modify the interest of the beneficiary with a disability even if the trustee does not have expanded 
distributive discretion.  When a trust has a beneficiary with a disability, it may not be in the 
beneficiary’s interest to make mandatory distributions to the beneficiary.  Further, it may be in 
the beneficiary’s interest to restructure the trust as a special-needs trust so that the trust does not   5 
adversely affect the beneficiary’s qualification for governmental benefits.  This carries out the 
settlor’s probable intent if the settlor had known of the beneficiary’s disability. 
Section 14 provides special rules to protect charitable interests. 
Sections 15 through 20 generally provide limitations on the exercise of the decanting 
power.  Section 15 addresses how express restrictions contained within the first-trust instrument 
may limit the decanting power.  Sections 16, 17, and 18 impose limitations on an authorized 
fiduciary exercising the decanting power in ways that might be considered self-dealing.  Section 
16 restricts decanting to increase the authorized fiduciary’s compensation.  Section 17 restricts 
decanting to increase the authorized fiduciary’s protection from liability.  Section 18 restricts the 
modification or elimination of a provision permitting a person to remove or replace the 
authorized fiduciary.  Section 19 imposes limitations on the decanting power that may be 
necessary to avoid disqualifying a trust for a particular tax benefit.  Section 20 addresses limits 
on the duration of a trust, such as the rule against perpetuities. 
Section 21 makes clear that even though the extent of the authorized fiduciary’s power to 
decant is generally determined based upon the degree of discretion over principal distributions, 
the authorized fiduciary may exercise the decanting power even if the authorized fiduciary would 
not have made a discretionary distribution at such time. 
Section 22 contains the remediation provision that is intended to salvage imperfect 
decantings.  Section 23 authorizes under certain circumstances decanting of trusts for the care of 
a nonhuman animal. 
Sections 24 through 32 contain miscellaneous provisions.  These provisions include 
Section 25, which recognizes that when a trust has been decanted it may no longer be obvious 
who is the settlor for different purposes and addresses who should be treated as the settlor for 
different purposes.  Section 26 provides a default rule for determining whether the first trust or 
second trust owns later-discovered property.  Section 27 makes clear that liabilities of the first 
trust are also liabilities of the second trust to the extent it received property from the first trust.   6 
UNIFORM TRUST DECANTING ACT 
SECTION 1.  SHORT TITLE. This [act] may be cited as the Uniform Trust Decanting 
Act. 
SECTION 2.  DEFINITIONS. In this [act]: 
(1) “Appointive property” means the property or property interest subject to a power of 
appointment. 
(2) “Ascertainable standard” means a standard relating to an individual’s health, 
education, support, or maintenance within the meaning of 26 U.S.C. Section 2041(b)(1)(A)[, as 
amended,] or 26 U.S.C. Section 2514(c)(1)[, as amended,] and any applicable regulations. 
(3) “Authorized fiduciary” means: 
 (A) a trustee or other fiduciary, other than a settlor, that has 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 9; or 
 (C) a special-needs fiduciary under Section 13. 
(4) “Beneficiary” means 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” means 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   7 
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” means:  
 (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” means 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” means the court in this state having jurisdiction in matters relating to trusts. 
(9) “Current beneficiary” means 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” or “the decanting power” means the power of an authorized 
fiduciary under this [act] 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” means a discretionary power of distribution that 
is not limited to an ascertainable standard or a reasonably definite standard. 
(12) “First trust” means a trust over which an authorized fiduciary may exercise the   8 
decanting power. 
(13) “First-trust instrument” means the trust instrument for a first trust. 
(14) “General power of appointment” means 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” means an individual, estate, business or nonprofit entity, public 
corporation, government or governmental subdivision, agency, or instrumentality, or other legal 
entity. 
(17) “Power of appointment” means 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” means a person in which a donor creates a power of appointment. 
(19) “Presently exercisable power of appointment” means 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” means a beneficiary that on the date the beneficiary’s   9 
qualification is determined: 
(A) is 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 without 
causing 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” means a clearly measurable standard under which a 
holder of a power of distribution is legally accountable within the meaning of 26 U.S.C. Section 
674(b)(5)(A)[, as amended,] and any applicable regulations. 
(22) “Record” means 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” means: 
 (A) a first trust after modification under this [act]; or  
 (B) a trust to which a distribution of property from a first trust is or may be made 
under this [act]. 
(24) “Second-trust instrument” means the trust instrument for a second trust. 
(25) “Settlor”, except as otherwise provided in Section 25, means 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” means, with present intent to authenticate or adopt a record:   10 
(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” means 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” means 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” means 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. 
Legislative Note:  A number of definitions in this section are identical to the definitions in the 
Uniform Trust Code.  A state that has adopted the Uniform Trust Code and is adopting this act 
as part of the Trust Code can omit these definitions.  If a state that has adopted the Uniform 
Trust Code is adopting this act but is not incorporating it into the Uniform Trust Code, the 
legislation could either repeat the definitions in this act or substitute where appropriate:  
“_______” has the meaning in Section _____ of the Uniform Trust Code. 
In states in which the constitution, or other law, does not permit the phrase “as amended” when 
federal statutes are incorporated into state law, the phrase should be deleted in paragraphs (2) 
and (21). 
In Section 2(8) the definition of “court” should be revised as needed to refer to the appropriate 
court having jurisdiction over trust matters. 
Comment 
Appointive Property.  The definition of “appointive property” is identical to the definition 
in Section 102(2) of the Uniform Powers of Appointment Act. 
Ascertainable Standard.  The definition of “ascertainable standard” is similar to the 
definition found in Section 103(2) of the Uniform Trust Code, but also includes the regulations   11 
to the cited sections of the Internal Revenue Code. 
A power that is limited to health, education, support or maintenance is limited to an 
ascertainable standard.  Treas. Reg. § 25.2514-1(c)(2).  Other powers limited to an ascertainable 
standard include “support in reasonable comfort,” “maintenance in health and reasonable 
comfort,” “support in the beneficiary’s accustomed manner of living,” “education, including 
college and professional education” and “medical, dental, hospital and nursing expenses and 
expenses of invalidism.”  A power to make distributions for comfort, welfare, happiness or best 
interests is not limited to an ascertainable standard.  In determining whether a power is limited 
by an ascertainable standard, it is immaterial whether the beneficiary is required to exhaust other 
income or resources before the power can be exercised. 
The entire context of the document should be considered in determining whether the 
standard is ascertainable.  For example, if the trust instrument provides that the determination of 
the trustee is conclusive with respect to the exercise of the standard, the power is not 
ascertainable. 
A power to make distributions “as the trustee deems advisable” or in the trustee’s “sole 
and absolute discretion” without further limitation is not subject to an ascertainable standard. 
The term is also construed by case law regarding Internal Revenue Code Sections 2036 
and 2038. 
Authorized Fiduciary.  The definition of “authorized fiduciary” includes only a person 
acting in a fiduciary capacity.  Only a fiduciary, subject to fiduciary duties, should have the 
power to decant.  A distribution director who is not a fiduciary should not have the power to 
decant. 
The definition excludes a settlor acting as a trustee.  If a settlor is a trustee of an 
irrevocable trust, gift and estate tax problems could result if the settlor had a decanting power.  
The definition does not exclude a beneficiary who is acting as a trustee (an “interested trustee”) 
because the act only permits a trustee with expanded distributive discretion to decant in a manner 
that would change beneficial interests.  Typically trusts will not give an interested trustee 
unascertainable discretion over discretionary distributions because such discretion would create 
gift and estate tax issues.  In the unusual event that a trust does give an interested trustee 
unascertainable discretion, the trustee will incur the tax effects of holding a general power of 
appointment whether or not the trustee also has a decanting power. 
If the discretion to distribute or to direct the trustee to distribute is held jointly by two or 
more trustees or other fiduciaries, the “authorized fiduciary” is such trustees or other fiduciaries 
collectively.  If the authorized fiduciary is comprised of two or more fiduciaries, the trust 
instrument or state law will generally provide whether they must act unanimously or whether 
they may act by majority or some other percentage vote.  For example, Section 703(a) of the 
Uniform Trust Code provides that trustees who are unable to reach unanimous decision may act 
by majority decision. 
The term also includes a special fiduciary appointed by the court under Section 9, who 
may exercise the decanting power.   12 
The term also includes a special-needs fiduciary under Section 13 even if such fiduciary 
does not have discretion to distribute principal of the first trust. 
Beneficiary.  The definition of “beneficiary” in Section 2(4)(A) and (B) is substantially 
similar to the definition found in Section 103(3) of the Uniform Trust Code.  Section 2(4)(C) 
adds as a beneficiary a charitable organization identified to receive distributions from a trust.  Cf. 
Uniform Trust Code § 110(a) and § 405(a).  Thus an identified charitable organization has the 
rights of a beneficiary under this act.  Absent Section 2(4)(C) such charities would not be 
considered beneficiaries.  Because a charitable interest is not created to benefit ascertainable 
charitable organizations but to benefit the community at large, persons receiving distributions 
from a charitable interest are not beneficiaries as that term is defined in the Uniform Trust Code.  
See Uniform Trust Code § 103, Comment. 
In addition to living and ascertained individuals, beneficiaries may be unborn or 
unascertained.  The term “beneficiary” includes not only beneficiaries who received their 
interests under the terms of the trust but also beneficiaries who received their interests by other 
means, including by assignment, exercise of a power of appointment, resulting trust upon the 
failure of an interest, gap in a disposition, operation of an antilapse statute upon the predecease 
of a named beneficiary, or upon termination of the trust.  A potential appointee of a power of 
appointment is not a beneficiary unless a presently exercisable power of appointment has been 
exercised in favor of such appointee.  A person who merely incidentally benefits from the trust is 
not a beneficiary.  See Restatement Third of Trusts § 48. 
While the holder of a power of appointment is not considered a trust beneficiary under 
the common law of trusts, powerholders are classified as beneficiaries under the Uniform Trust 
Code.  Powerholders are included on the principle that their interests are significant enough that 
they should be afforded the rights of beneficiaries.  A power of appointment as used in state trust 
law and the Uniform Trust Code is as defined in state property law and not federal tax law 
although there is considerable overlap between the two definitions. 
Charitable Interest.  The term “charitable interest” includes an interest held by a 
charitable organization that makes the charitable organization a qualified beneficiary.  Section 
2(5).  See Section 2(4)(C) defining the term “beneficiary” to include an identified charitable 
organization that may or will receive distributions under the terms of a trust.  See Section 2(20) 
defining a qualified beneficiary. 
For example, a trust might provide for a certain amount to be distributed annually to 
Gentoos Need You, a charitable organization, and permit the trustee to make discretionary 
distributions of principal to the settlor’s descendants.  Upon the death of the settlor’s last 
surviving child, $100,000 is to be paid to Gentoos Need You and the remainder to trusts for the 
settlor’s grandchildren.  The annuity interest and the remainder interest held by Gentoos Need 
You are both charitable interests because they are held by an identified charitable organization 
and make the organization a qualified beneficiary. 
The term “charitable interest” also includes an interest that can benefit only charitable 
organizations and that, if held by an identified charitable organization, would make the charitable 
organization a qualified beneficiary.  Section 2(5)(B).  For example, if the trustee is to distribute   13 
$50,000 from the trust each year for ten years to one or more charitable organizations selected by 
the trustee that protect Antarctica and its wildlife, the trustee also has discretion to distribute 
income and principal to individual beneficiaries, and at the end of ten years the trustee is to 
distribute the remainder to the settlor’s descendants, the $50,000 annuity is a charitable interest 
because it may be distributed only to charitable organizations. 
As another example, if the trustee may make discretionary principal distributions to the 
settlor’s spouse, and upon the spouse’s death is to distribute one-half of the principal to 
charitable organizations that protect the Arctic and its wildlife, and the other one-half to the 
settlor’s descendants, there is a charitable interest in one-half of the remainder. 
The term “charitable interest” also includes an interest devoted solely to charitable 
purposes, even if the charitable purposes may be carried out directly by the trust rather than 
through distributions to charitable organizations.  Section 2(5)(C).  The act, however, does not 
apply to a wholly charitable trust.  See Section 3(b). 
The term does not include contingent, successor charitable interests that are not 
equivalent to the interests held by qualified beneficiaries.  For example, if a trust permits 
distributions to Child A, and upon Child A’s death the trust distributes to Child A’s descendants, 
or if none, to the settlor’s descendants, or if none, to the Manatee Preservation Fund, a charitable 
organization, and Child A or the settlor has one or more descendants living, the interest of the 
Manatee Preservation Fund does not make it a qualified beneficiary and therefore its interest is 
not a charitable interest. 
Charitable Organization.  The definition of “charitable organization” is based on the 
definition of “institution” in the Uniform Prudent Management of Institutional Funds Act 
(Section 2(4)), except that it excludes trusts. 
Charitable Purpose.  The definition of “charitable purpose” is similar to the definition in 
Section 405 of the Uniform Trust Code.  The definition of “charitable purpose” follows that of 
Section 28 of the Restatement Third of Trusts and Section 2(1) of the Uniform Prudent 
Management of Institutional Funds Act.  This definition derives from common law and 
ultimately the English Statute of Charitable Uses, enacted in 1601.  A charitable purpose is a 
nonprofit purpose (and not a purpose for private benefit) that benefits an indefinite class of the 
public.  
The definition includes purposes “beneficial to the community” because that concept is 
part of the traditional definition of charitable purposes. The definition means purposes 
considered charitable and not merely beneficial. Many activities and organizations, such as social 
welfare organizations, cooperative associations, and business entities, benefit the community. 
Nonetheless, these organizations and the activities they carry on are not charitable within the 
meaning of the act because their earnings inure to the benefit of private persons such as members 
or shareholders. Attorney General v. Weymouth Agricultural & Industrial Society, 400 Mass. 
475, 479, 509 N.E.2d 1193, 1195 (1987). The definition of charitable has long been limited to 
those beneficial purposes that fit within one of the other categories of charitable, for example 
educational, relating to the relief of poverty, or providing some general good such as 
improvement of the environment. By using the standard definition, the act intends to include the   14 
case law that has developed around the term “charitable” in trust law. See the comment to 
Section 2(2) of the Model Protection of Charitable Assets Act. 
Court.  The term “court” means the court having jurisdiction in matters related to trusts.  
The definition should be revised by the enacting state as appropriate. 
Current Beneficiary.  The term “current beneficiary” means a beneficiary who is 
currently a distributee or permissible distributee of income or principal.  A current beneficiary is 
a qualified beneficiary described in Section 2(20)(A).  A mere holder of a power of appointment 
is not a current beneficiary unless the power is a presently exercisable general power of 
appointment.  The term does not include the objects of an unexercised inter vivos power of 
appointment. 
Decanting Power or The Decanting Power.  The term “decanting power” or “the 
decanting power” means the power granted in this act to the authorized fiduciary (see Section 
2(3)) to distribute all or part of the property of the first trust to a second trust or, alternatively, to 
modify the terms of the first trust to create the second trust.  The term does not include any 
similar power that may be granted under the terms of the trust instrument or pursuant to common 
law. 
If the terms of the first trust are modified, it is not necessary to treat the second trust as a 
newly created, separate trust, thus avoiding the need to transfer title of the property of the first 
trust to the second trust.  If all of the property of the first trust is distributed pursuant to an 
exercise of the decanting power to a separate second trust, then the first trust would terminate.  
The termination of the first trust may impose certain duties on the trustee such as providing 
reports to the beneficiaries and filing final income tax returns. 
Expanded Distributive Discretion.  “Expanded distributive discretion” is any discretion 
that is not limited to an ascertainable standard (see Section 2(2)) as used in Internal Revenue 
Code Section 2514(c)(1) or to a reasonably definite standard (see Section 2(21)) as used in 
Internal Revenue Code Section 674(b)(5)(A).  The tax terms are used here, one from gift tax 
rules and one from income tax rules, because the definitions of these tax terms are generally 
clearer than the definitions of nontax terms sometimes used to describe different types of trustee 
discretion. 
First Trust.  The terms “first trust” and “second trust” (Section 2(23)) are relative to the 
particular exercise of the decanting power.  Thus when the decanting power is exercised over 
Trust A to make a distribution to Trust B, Trust A is the first trust and Trust B is the second trust 
with respect to such exercise of the decanting power.  If the decanting power is later exercised 
over Trust B to make a distribution to Trust C, then Trust B would be the first trust and Trust C 
the second trust with respect to such exercise of the decanting power. 
First-Trust Instrument.  See Section 2(12) for the definition of “first trust” and Section 
2(29) for the definition of “trust instrument.” 
General Power of Appointment.  The definition of “general power of appointment” is 
identical to the definition in Section 102(6) of the Uniform Powers of Appointment Act.   15 
Jurisdiction.  The definition of “jurisdiction” is virtually identical to the definition in 
Section 103(9) of the Uniform Trust Code. 
Person.  The definition of “person” is identical to the definition of “person” in Section 
102(12) of the Uniform Powers of Appointment Act.  With one exception, this is the standard 
definition approved by the Uniform Law Commission.  The exception is that the word “trust” has 
been added to the definition of “person.”  Trust law in the United States is moving in the 
direction of viewing the trust as an entity, see Restatement Third of Trusts introductory note to 
Chapter 21, but does not yet do so.  This definition differs slightly in wording, but not in 
substance, from the definition of “person” used in Section 103(10) of the Uniform Trust Code.  
The Uniform Trust Code defines “person” as “an individual, corporation, business trust, estate, 
trust, partnership, limited liability company, association, joint venture, government; 
governmental subdivision, agency, or instrumentality; public corporation, or any other legal or 
commercial entity.” 
Power of Appointment.  The definition of “power of appointment” is identical to the 
definition in Section 102(13) of the Uniform Powers of Appointment Act. 
Powerholder.  The definition of “powerholder” is identical to the definition in Section 
102(14) of the Uniform Powers of Appointment Act. 
Presently Exercisable Power of Appointment.  The definition of “presently exercisable 
power of appointment” is substantially similar to the definition in Section 102(15) of the 
Uniform Powers of Appointment Act. 
Qualified Beneficiary.  The definition of “qualified beneficiary” is substantially the same 
as the definition in Section 103(13) of the Uniform Trust Code.  Note, however, that the 
expanded definition of “beneficiary” in Section 2(4) includes charitable organizations identified 
to receive distributions in charitable trusts.  Such charitable organizations would be entitled to 
notice of an exercise of the decanting power under Section 7. 
The qualified beneficiaries consist of the current beneficiaries (see Section 2(9)) and the 
presumptive remainder beneficiaries (see Section 11(a)(2)). 
The holder of a presently exercisable general power of appointment is a qualified 
beneficiary.  A person who would have a presently exercisable general power of appointment if 
the trust terminated on that date or if the interests of the current beneficiaries terminated on that 
date without causing the trust to terminate is also a qualified beneficiary.  The term does not 
include the holder of a testamentary general power of appointment or the holder of a nongeneral 
limited power of appointment.  Nor does the term include the objects of an unexercised inter 
vivos power of appointment. 
When a trust has distributees or permissible distributees of trust income or principal who 
are in more than one generation of the descendants of a person and the trust continues after the 
deaths of the members of the most senior generation who are included among such distributees, 
Section 2(20)(B) should be construed to include the distributees or permissible distributees after 
the interests of the most senior generation of such distributees terminate and subparagraph (C) 
would not ordinarily be applicable if there are any current beneficiaries who are not members of   16 
the most senior generation.  Assume a trust permits discretionary distributions to any of A’s 
descendants, and only terminates if A has no living descendants, in which case it is distributed to 
B, and A’s now living descendants are Child 1, Child 2, Grandchild 1A and Grandchild 1B.  The 
presumptive remainder beneficiaries are Grandchild 1A and Grandchild 1B pursuant to Section 
2(20)(B), and Section 2(20)(C) should not apply to cause B to be a presumptive remainder 
beneficiary.  On the other hand, if A’s then living descendants were limited to Child 1 and Child 
2, then B would be the presumptive remainder beneficiary under Section 2(20)(C), because there 
is no presumptive remainder beneficiary under Section 2(20)(B). 
Reasonably Definite Standard.  “Reasonably definite standard” is defined in Treasury 
Regulations Section 1.674(b)-1(b)(5).  “Reasonably definite standard” includes an ascertainable 
standard but may also include standards that would not be considered ascertainable standards.  A 
power to distribute principal for the education, support, maintenance, or health of the 
beneficiary; for the beneficiary’s reasonable support and comfort; or to enable the beneficiary to 
maintain the beneficiary’s accustomed standard of living; or to meet an emergency; would be a 
reasonably definite standard.  A power to distribute principal for the pleasure, desire, or 
happiness of a beneficiary is not a reasonably definite standard.  A power to make distributions 
“as the trustee deems advisable” or in the trustee’s “sole and absolute discretion” without further 
limitation is not a reasonably definite standard.  A reasonably definite standard need not require 
consideration of the needs and circumstances of the beneficiary. 
The entire context of a provision of a trust instrument granting a power should be 
considered in determining whether there is a reasonably definite standard.  For example, if a trust 
instrument provides that the determination of the trustee shall be conclusive with respect to the 
exercise or nonexercise of a power, the power is not limited by a reasonably definite standard.  
The fact, however, that the governing instrument is phrased in discretionary terms is not in itself 
an indication that no reasonably definite standard exists. 
Internal Revenue Code Section 674(d) uses the term “reasonably definite external 
standard.”  The term “reasonably definite external standard” appears to have the same meaning 
as “reasonably definite standard.”  See Treas. Reg. § 1.674(d)-1. 
The term is also construed by case law regarding Internal Revenue Code Sections 2036 
and 2038. 
Record.  The definition of “record” is identical to the definition in Section 102(16) of the 
Uniform Powers of Appointment Act.  This is a standard definition approved by the Uniform 
Law Commission. 
Second Trust.  The definition of “second trust” includes (1) an irrevocable trust already in 
existence, whether created by the settlor of the first trust or a different settlor, (2) a “restatement” 
of the first trust which could be executed by the authorized fiduciary or another person as the 
nominal grantor, (3) the first trust as modified to create the second trust, or (4) a new trust 
executed by the authorized fiduciary or another person as the nominal settlor for the purpose of 
decanting.  A decanting that is implemented by “restating” or modifying the first trust 
presumably would not require the issuance of a new tax identification number or the retitling of 
property or a final income tax return for the trust.  A decanting that distributes the property of the   17 
first trust to another trust presumably would require that the property be retitled.  Further, if the 
first trust was terminated by reason of the decanting, a final income tax return for the first trust 
would be required. 
Second-Trust Instrument.  See Section 2(23) for the definition of “second trust” and 
Section 2(29) for the definition of “trust instrument.” 
Settlor.  The definition of “settlor” generally follows the definition in Section 103(15) of 
the Uniform Trust Code, but is modified by Section 25 of this act to address the issue of who is 
the settlor of the second trust after the exercise of the decanting power.  When more than one 
person signs the trust instrument or funds a trust, generally the person funding the trust will be 
the settlor.  See comments to Section 103 of the Uniform Trust Code.  Should more than one 
person contribute to a trust, all of the contributors will ordinarily be treated as settlors in 
proportion to their respective contributions, regardless of which one signed the trust instrument.  
Id. A “settlor” includes a testator who creates a testamentary trust. 
Sign.  The definition of “sign” is the same definition used in Section 2(8) of the Uniform 
Premarital and Marital Agreements Act. 
State.  The definition of “state” is virtually identical to the definition in Section 103(17) 
of the Uniform Trust Code except that it omits the sentence including certain Indian tribes or 
bands. 
Terms of the Trust.  The definition of “terms of the trust” is similar to the definition in 
Section 103(18) of the Uniform Trust Code, including 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 admissible in a judicial proceeding.  The definition in Section 2(28) expands on the 
definition in the Uniform Trust Code by providing that the terms of the trust may also be 
established by court order or nonjudicial settlement agreement. 
Trust Instrument.  The definition of “trust instrument” is substantially similar to the 
definition in Section 103(19) of the Uniform Trust Code, except that it expressly includes any 
second trust and clarifies that the trust instrument may only contain some of the terms of the 
trust.  The Uniform Trust Code definition is expanded to make clear that where the second trust 
is a trust created by the trustee for the purpose of decanting, such instrument is considered to be 
an “instrument” even though the trustee is not considered to be the settlor of the second trust for 
all purposes.  See Section 25.  Other terms of the trust may be established by other evidence that 
would be admissible in a judicial proceeding, or by court order or nonjudicial settlement 
agreement.  See Section 2(28).  If the second trust is created for purposes of decanting, the 
second-trust instrument may be executed by the authorized fiduciary or another person as the 
nominal settlor. 
 SECTION 3.  SCOPE. 
(a) Except as otherwise provided in subsections (b) and (c), this [act] applies to an 
express trust that is irrevocable or revocable by the settlor only with the consent of the trustee or   18 
a person holding an adverse interest. 
(b) This [act] does not apply to a trust held solely for charitable purposes. 
(c) Subject to Section 15, a trust instrument may restrict or prohibit exercise of the 
decanting power. 
(d) This [act] does not limit the power of a trustee, powerholder, or other person to 
distribute or appoint property in further trust or to modify a trust under the trust instrument, law 
of this state other than this [act], common law, a court order, or a nonjudicial settlement 
agreement. 
(e) This [act] does not affect the ability of a settlor to provide in a trust instrument for the 
distribution of the trust property or appointment in further trust of the trust property or for 
modification of the trust instrument. 
Comment 
The Uniform Trust Decanting Act applies to all express trusts that are irrevocable or that 
are revocable by the settlor only with the consent of the trustee or a person holding an adverse 
interest.  The act does not apply to a trust revocable by the settlor without the consent of the 
trustee or a person holding an adverse interest, even if the settlor is incapacitated and thus unable 
to exercise the power to amend or revoke.  Thus the act does not apply to a revocable trust as that 
term is defined in Section 103(14) of the Uniform Trust Code. 
Section 5-411(a)(4) of the Uniform Guardianship and Protective Proceedings Act allows 
a conservator to amend (and revoke) the terms of a protected person’s revocable trust.  Section 
201(a)(1) of the Uniform Power of Attorney Act allows a settlor to grant a power to amend or 
revoke to an agent.  Accordingly, while the settlor is alive, there are uniform rules for modifying 
a revocable trust.  States that have not adopted these uniform rules may have other provisions for 
modification of a revocable trust when the settlor is incapacitated. 
The act does not permit decanting a trust held solely for charitable purposes (a “wholly 
charitable trust”).  Section 3(b).  A private foundation structured as a trust would be a wholly 
charitable trust that could not be decanted pursuant to the act. 
A wholly charitable trust is subject to different public policy concerns than a private trust.  
Private trusts have identifiable beneficiaries who may enforce their interests in the trust.  
Charitable trusts have as beneficiaries the community as a whole or charitable organizations, and 
enforcement may be left to the state’s Attorney General or another official.  Further, charitable 
trusts often have particular charitable purposes, and conditions or restrictions on the use of the   19 
trust assets.  Settlors of wholly charitable trusts often have particularly strong interests in seeing 
that these purposes, conditions and restrictions are not changed.  Special legal doctrines, such as 
cy pres, are available when it becomes unlawful, impossible, or impracticable to carry out the 
purposes of a wholly charitable trust. 
If an irrevocable trust that has noncharitable beneficiaries will in the future be used to 
fund a wholly charitable trust, the decanting power may be exercised over the irrevocable trust, 
subject to Section 14, but the decanting may not change the terms of the wholly charitable trust. 
To the extent a conservation easement or other restricted gift is considered to be an 
express trust, such an interest would be a wholly charitable trust that could not be decanted 
pursuant to the act. 
While a split interest trust such as a charitable remainder trust or charitable lead trust 
would not be a wholly charitable trust, in almost all cases the trustee of such a trust would not 
have discretion to distribute principal to a current beneficiary and therefore there would not be an 
authorized fiduciary (see Section 2(3)) who would have authority to exercise the decanting 
power under Section 11 or Section 12. 
If an authorized fiduciary has discretion to distribute principal of a trust that is not a 
wholly charitable trust but that contains a charitable interest (see Section 2(5)), the charitable 
interest may not be diminished, the charitable purpose set forth in the first trust may not be 
changed and any conditions or restrictions on the charitable interest may not be changed.  See 
subsection 14(c). 
The Uniform Trust Decanting Act is not the exclusive way to decant a trust and is not the 
exclusive way to modify a trust.  The terms of the trust instrument may grant a fiduciary or other 
person the power to modify the trust.  This act does not supplant any authority granted under 
such a trust provision.  Any such authority granted under the trust instrument does not affect the 
application of this act unless the trust instrument imposes an express restriction on the exercise 
of the decanting power under this act or other state statute authorizing a fiduciary to decant.  See 
Section 15(b). 
A decanting statute of another state may apply to a trust and, even if this act could also 
apply to the trust, this act does not supplant the right of a trustee to decant under the statute of 
such other state.  Thus in some situations a fiduciary may have the option of decanting under this 
act or the decanting statute of another state. 
Common law in some states may permit a trustee to decant.  This act does not supplant 
any right to decant under common law.  Thus in some cases a fiduciary may have the option of 
decanting under this act or under common law. 
Section 111 of the Uniform Trust Code and statutes in many states permit certain matters 
regarding a trust to be resolved by a nonjudicial settlement agreement among the interested 
persons.  Those statutes generally permit certain beneficiaries of a trust to approve an exercise of 
a power by a trustee and thus would permit certain beneficiaries to approve an exercise of the 
decanting power.  In some cases the modification made by an exercise of the decanting power 
could also have been made by a virtual representation agreement, and in those cases an exercise   20 
of the decanting power sometimes might be combined with a nonjudicial settlement agreement.  
Generally, the nonjudicial settlement agreement would prevent any subsequent challenges to the 
decanting.  The tax consequences of having the beneficiaries consent to the nonjudicial 
settlement agreement should be considered. 
 SECTION 4.  FIDUCIARY DUTY. 
(a) In exercising the decanting power, an authorized fiduciary shall act in accordance 
with its fiduciary duties, including the duty to act in accordance with the purposes of the first 
trust. 
(b) This [act] does not create or imply a duty to exercise the decanting power or to inform 
beneficiaries about the applicability of this [act]. 
(c) Except as otherwise provided in a first-trust instrument, for purposes of this [act] [and 
Sections 801 and 802(a) of the Uniform Trust Code], the terms of the first trust are deemed to 
include the decanting power. 
Legislative Note:  Section 801 of the Uniform Trust Code provides that the trustee shall 
administer a trust in accordance with its terms.  Section 802(a) of the Uniform Trust Code 
provides that a trustee shall administer a trust solely in the interests of the beneficiaries.  If a 
state has adopted the Uniform Trust Code, the bracketed language in subsection (c) should be 
included to make clear that the terms of the trust include the decanting power and that the 
“interests of the beneficiaries” takes into account the decanting power. 
Comment 
Except as noted below, in exercising the decanting power, the authorized fiduciary is 
subject to the same fiduciary duties as in exercising any other discretionary power.  For example, 
Section 801 of the Uniform Trust Code provides that the trustee shall administer the trust in good 
faith, in accordance with its terms and purposes and the interests of the beneficiaries.  Section 
814(a) of the Uniform Trust Code provides that a trustee shall exercise a discretionary power in 
good faith and in accordance with the terms and purposes of the trust and the interests of the 
beneficiaries.  Section 76 of the Restatement Third of Trusts provides that a trustee has a duty to 
administer the trust diligently and in good faith, in accordance with the terms of the trust and 
applicable law. 
An exercise of the decanting power must be in accordance with the purposes of the first 
trust.  The purpose of decanting is not to disregard the settlor’s intent but to modify the trust to 
better effectuate the settlor’s broader purposes or the settlor’s probable intent if the settlor had 
anticipated the circumstances in place at the time of the decanting.  The settlor’s purposes 
generally include efficient administration of the trust.  The settlor’s purposes may also include   21 
achieving certain tax objectives or generally minimizing overall tax liabilities.  The settlor’s 
purposes often include avoiding fruitless, needless dissipation of the trust assets should a 
beneficiary develop dependencies such as substance abuse or gambling, have creditor problems, 
or otherwise be unfit to prudently manage assets that might be distributed from the trust. 
The exercise of the decanting power need not be in accord with the literal terms of the 
first-trust instrument because decanting by definition is a modification of the terms of the first 
trust.  Therefore subsection 4(c) provides that the terms of the first trust shall be deemed to 
include the decanting power for purposes of determining the fiduciary duties of the authorized 
fiduciary.  Nonetheless, the other terms of the first trust may provide insight into the purposes of 
the first trust and the settlor’s probable intent under current circumstances. 
Section 802 of the Uniform Trust Code and Section 78 of the Restatement Third of Trusts 
impose a duty of loyalty on the trustee.  Thus in exercising a decanting power the trustee cannot 
place the trustee’s own interests over those of the beneficiaries.  For example, an authorized 
fiduciary may breach its fiduciary duties if the authorized fiduciary decants to permit self-
dealing.  While Sections 16, 17 and 18 expressly prohibit making certain changes that benefit the 
authorized fiduciary and are not likely to be in the beneficiaries’ interests, these sections do not 
include all of the changes that may be breaches of the authorized fiduciary’s fiduciary duties. 
Section 803 of the Uniform Trust Code and Section 79 of the Restatement Third of Trusts 
impose a duty to treat the beneficiaries impartially.  The duty to act impartially does not mean 
that the trustee must treat the beneficiaries equally.  Rather the trustee must treat the beneficiaries 
equitably in light of the purposes and terms of the trust. 
Section 804 of the Uniform Trust Code imposes a duty to administer the trust as a 
prudent person would and to exercise reasonable care, skill and caution.  See also Restatement 
Third of Trusts:  Prudent Investor Rule § 90 (2007). 
Decanting may be appropriate in many situations in which judicial modification would be 
appropriate such as (1) when modification, because of circumstances not anticipated by the 
settlor, would further the purposes of the trust (see Uniform Trust Code § 412(a) and 
Restatement Third of Trusts § 66); (2) when continuation of the trust on its existing terms would 
be impracticable or wasteful or impair the trust’s administration (see Uniform Trust Code 
§ 412(b)); (3) to replace the trustee if the value of the trust is insufficient to justify the costs of 
administration with the current trustee (see Uniform Trust Code § 414(b)); (4) to correct 
mistakes (see Uniform Trust Code § 415); (5) to achieve the settlor’s tax objectives (see Uniform 
Trust Code § 416); and (6) to combine or divide trusts (see Uniform Trust Code § 417 and 
Restatement Third of Trusts § 68). 
The Uniform Trust Decanting Act does not impose a duty on the authorized fiduciary to 
decant.  To impose a duty on the authorized fiduciary to consider whether any possible decanting 
could improve the administration of the trust or further the trust purposes would create unfair 
risks and burdens for fiduciaries and also might, in some situations, present impartiality issues.  
A trustee cannot possibly consider all the possible ways in which a trust could be improved by 
decanting.  While this act does not create a presumption in favor of the terms of the first trust, an 
authorized fiduciary generally should not be penalized for not modifying the terms of the trust.   22 
There may be, however, circumstances in which the authorized fiduciary or trustee has a 
duty under general trust law to seek a deviation from the terms of the trust even if the authorized 
fiduciary or trustee does not have a duty to exercise a decanting power.  Subsection 66(2) of the 
Restatement Third of Trusts provides: 
(2) If a trustee knows or should know of circumstances that justify 
judicial action under Subsection (1) with respect to an administrative provision, 
and of the potential of those circumstances to cause substantial harm to the 
trust or its beneficiaries, the trustee has a duty to petition the court for 
appropriate modification of or deviation from the terms of the trust. 
While subsection 66(2) is literally limited to deviations involving administrative provisions, 
Comment e to subsection 66(2) extends the trustee’s duty to distribution provisions when the 
trustee is actually aware that a purpose of the settlor would be jeopardized by adhering to the 
existing provision regarding distributions. 
The Reporter’s Note to Comment e to subsection 66(2) of the Restatement Third of 
Trusts notes that the situations that might result in a duty to seek a deviation if the trustee has 
actual knowledge of the circumstances include extraordinary needs of the life beneficiary or 
irresponsibility of a potential distributee.  See Illustration 2 in the Comments on subsection 66(1) 
of the Restatement Third of Trusts and the last paragraph of the Reporter’s Note to Comment b 
to Section 66 of the Restatement Third of Trusts.  In the Reporter’s Notes to Comment b of 
Section 66 of the Restatement Third of Trusts, the Reporter notes that there may be a duty to 
seek deviation when there would be substantial distributions to beneficiaries who are legally 
competent to manage funds but practically at serious risk of squandering those distributions due, 
for example, to substance addiction or gambling.  Although the Uniform Trust Decanting Act 
does not impose a duty to decant, an exercise of the decanting power would usually be an 
appropriate exercise of the authorized fiduciary’s discretion in such circumstances.  See also 
Restatement Third of Trusts § 87. 
Where the trustee has a duty to seek a deviation and the appropriate deviation could be 
achieved by an exercise of the decanting power, the trustee could fulfill such duty by an exercise 
of the decanting power rather than seeking a judicial deviation. 
SECTION 5.  APPLICATION; GOVERNING LAW.  This [act] applies to a trust 
created before, on, or after [the effective date of this [act]] which: 
(1) has its principal place of administration in this state, including a trust whose principal 
place of administration has been changed to this state; or 
(2) provides by its trust instrument that it is governed by the law of this state or is 
governed by the law of this state for the purpose of: 
 (A) administration, including administration of a trust whose governing law for   23 
purposes of administration has been changed to the law of this state; 
 (B) construction of terms of the trust; or 
 (C) determining the meaning or effect of terms of the trust. 
Comment 
Because the authorized fiduciary by decanting is exercising a power over the first trust, 
the requirements in Section 5 apply to the first trust.  It is irrelevant whether the second trust is 
governed by the law of the state or administered in the state. 
The laws of different states may govern a trust for purposes of determining its validity, 
for purposes of construing the trust and for purposes of administration of the trust.  The 
determination of the state law that governs for these purposes is also dependent upon whether the 
trust property consists of movables or land and whether the trust was created by a will or by an 
inter vivos instrument.  See Restatement Second of Conflict of Laws §§ 267-279; Uniform Trust 
Code § 107; see also Uniform Probate Code § 2-703. 
To provide greater certainty about whether the act applies to a trust, Section 5(2) provides 
that the act applies to a trust that by its terms provides that it is governed by the law of the 
enacting state, without further inquiry as to whether the law of the enacting state actually applies.  
The act also applies where the law of the enacting state in fact governs administration of the 
trust, construction of the terms of the trust, or determination of the meaning or effect of terms of 
the trust, whether or not the trust instrument expressly so states. 
Decanting is considered an administrative power because it deals with the powers of the 
trustee.  See Comment a to the Restatement Second Conflict of Laws § 271 (testamentary trusts) 
and Comment a to § 272 (inter vivos trusts).  Decanting, however, can alter the beneficial 
interests of a trust.  In order to avoid having different rules for the application of the act 
depending upon whether the exercise of the decanting power changes administrative provision or 
beneficial interests, and the difficulty of drawing a distinct line between modifications that are 
administrative in nature and modifications that change beneficial interests, the act is intended to 
have broad application. 
This act applies if the law of the state governs for purposes of any one or more of 
administration, meaning or effect.  “Meaning and effect” are the terms used in the Uniform Trust 
Code (see Section 107).  “Construction” is the term used in the Restatement Second of Conflicts. 
This act also applies if the trust instrument states that the law of the state governs for 
purposes of any one or more of administration, meaning or effect without the necessity of 
establishing that the law of the state in fact governs for such purpose. 
Alternatively, it is sufficient if the trust has its principal place of administration in the 
state.  See Section 108 of the Uniform Trust Code with respect to the principal place of 
administration of a trust.  While a change of principal place of administration will usually change 
the law governing the administration of the trust, that is not the result under all circumstances.    24 
To avoid the difficulties of determining whether the law governing administration has changed 
when the principal place of administration has changed, the act applies to any trust with a 
principal place of administration in the state, regardless of what state law governs its 
administration and meaning and effect. 
SECTION 6.  REASONABLE RELIANCE.  A trustee or other person that reasonably 
relies on the validity of a distribution of part or all of the property of a trust to another trust, or a 
modification of a trust, under this [act], law of this state other than this [act], or the law of 
another jurisdiction is not liable to any person for any action or failure to act as a result of the 
reliance. 
Comment 
A trustee should be able to administer a trust with some dispatch and without concern 
that reliance on a prior decanting is misplaced.  This section allows a trustee, other fiduciary or 
other person to reasonably rely on the validity of a prior decanting, whether that decanting was 
performed under the act or under other law of the state or another jurisdiction.  Thus this section 
relieves a trustee or other fiduciary from any duty it might otherwise have to determine 
definitively the validity of a prior decanting. 
The person’s reliance on the validity of a prior decanting must be reasonable.  Thus a 
fiduciary must still review the facts of the prior decanting, whether it appears to be in compliance 
with the statute or other law under which the decanting was performed, and whether the law 
under which the decanting was performed appears to be applicable to the trust.  If the second 
trust contains provisions that clearly are prohibited by the applicable decanting law, or fails to 
contain provisions that are clearly required by the applicable decanting law, reliance would not 
be reasonable. 
When trusts have changed jurisdictions, it may be difficult to determine what law governs 
the administration of the trust.  When trusts have multiple trustees, or a trustee conducts different 
trust functions in different places, it may be difficult to determine where the trust is administered.  
Thus it may be difficult in some cases to confirm with certainty which state decanting law 
applied to a prior attempted decanting.  In some instances more than one state’s decanting law 
may appear to apply, creating further uncertainty if the prior attempted decanting did not comply 
with all of the potentially applicable statutes.  Section 6 protects a trustee or other person who 
makes a reasonable determination about which state decanting law applied to a prior decanting. 
Ordinarily, a trustee or other person relying on a prior decanting need not independently 
verify compliance with every procedural rule of the decanting law.  For example, ordinarily, the 
person relying on the prior decanting need not verify that every person required by the statute to 
receive notice in fact received notice.  If such person knew, however, that the decanting law 
required notice and that no notice was given, reliance would not be reasonable.   25 
This section does not validate any or all attempted decantings.  Even if a trustee or other 
person may reasonably rely on a prior decanting, an interested person may still have the ability to 
challenge the decanting as invalid. 
There may be times when the trustee or other person has sufficient questions about a 
prior attempted decanting that additional action is required to determine whether the prior 
attempted decanting was valid, in whole or in part, and to clarify the operating terms of the trust.  
In some cases the authorized fiduciary might use a new, properly implemented decanting to 
clarify the terms of the trust prospectively.  In other cases a nonjudicial settlement agreement 
between the trustee and interested parties might be used to conform the effective terms of the 
trust.  In some cases the trustee or other person might petition the court to determine the effective 
terms of the trust. 
 SECTION 7.  NOTICE; EXERCISE OF DECANTING POWER . 
(a) In this section, a notice period begins on the day notice is given under subsection (c) 
and ends [59] days after the day notice is given. 
(b) Except as otherwise provided in this [act], an authorized fiduciary may exercise the 
decanting power without the consent of any person and without court approval. 
(c) Except as otherwise provided in subsection (f), an authorized fiduciary shall give 
notice in a record of the intended exercise of the decanting power not later than [60] days before 
the exercise to: 
 (1) each settlor of the first trust, if living or then in existence; 
 (2) each qualified beneficiary of the first trust; 
 (3) each holder of a presently exercisable power of appointment over any part or 
all of the first trust; 
 (4) each person that currently has the right to remove or replace the authorized 
fiduciary; 
 (5) each other fiduciary of the first trust;  
 (6) each fiduciary of the second trust; and 
 (7) [the Attorney General], if Section 14(b) applies.   26 
(d) [An authorized fiduciary is not required to give notice under subsection (c) to a 
qualified beneficiary who is a minor and has no representative or] [An authorized fiduciary is not 
required to give notice under subsection (c)] to a person that is not known to the fiduciary or is 
known to the fiduciary but cannot be located by the fiduciary after reasonable diligence. 
(e) A notice under subsection (c) must: 
 (1) specify the manner in which the authorized fiduciary intends to exercise the 
decanting power; 
 (2) specify the proposed effective date for exercise of the power; 
 (3) include a copy of the first-trust instrument; and 
 (4) include a copy of all second-trust instruments. 
(f) The decanting power may be exercised before expiration of the notice period under 
subsection (a) if all persons entitled to receive notice waive the period in a signed record. 
(g) The receipt of notice, waiver of the notice period, or expiration of the notice period 
does not affect the right of a person to file an application under Section 9 asserting that: 
 (1) an attempted exercise of the decanting power is ineffective because it did not 
comply with this [act] or was an abuse of discretion or breach of fiduciary duty; or 
 (2) Section 22 applies to the exercise of the decanting power. 
(h) An exercise of the decanting power is not ineffective because of the failure to give 
notice to one or more persons under subsection (c) if the authorized fiduciary acted with 
reasonable care to comply with subsection (c). 
Legislative Note: Subsection (a) might apply a different rule than the state’s general rule 
governing computation of days. 
In subsection (c)(7), “Attorney General” is placed in brackets to accommodate a jurisdiction 
that grants enforcement authority over charitable interests in trusts to another designated 
official.  The bracketed text in subsection (d) should be included when state law does not in all 
cases provide a representative for a minor beneficiary, so that notice is not required to be given   27 
to the minor personally. 
Comment 
Generally a trustee is not required to provide notice to beneficiaries prior to exercising a 
discretionary power.  This section is not intended to change the law in this regard except with 
respect to exercises of the decanting power.  Because qualified beneficiaries are entitled to know 
the terms of the trust, they should receive notice of any change in the terms of the trust.  
Requiring prior notice seems reasonable, in light of the significant trust modifications that can be 
made by decanting, and practical, in that it helps determine if any settlor, fiduciary or beneficiary 
has an objection to or may challenge the decanting.  Any person entitled to notice under 
subsection 7(c) may petition the court under Section 9 for a determination of whether the 
proposed or attempted exercise of the decanting power is an abuse of discretion or does not 
otherwise comply with the act. 
If a qualified beneficiary is a minor, incapacitated, or unknown, or a beneficiary whose 
identity or location is not reasonably ascertainable, the representation principles of applicable 
state law may be employed.  Under state law, an emancipated minor presumably may represent 
himself or herself. 
Notice must be given to (a) each settlor of the first trust (see Section 2(25)); (b) all 
qualified beneficiaries (see Section 2(20)); (c) each holder of a presently exercisable power of 
appointment, whether or not such holder is a qualified beneficiary; (d) any person who may 
remove or replace the authorized fiduciary; (e) all other fiduciaries of the first trust; (f) all 
fiduciaries of the second trust or trusts; and (g) the Attorney General (or other official with 
enforcement authority over charitable interests) if there is a determinable charitable interest (see 
Section 14(a)(1)).  If the authorized fiduciary is comprised of more than one fiduciary, notice 
should be given to any person who may remove or replace any of such fiduciaries.  The term 
“replace” refers to the power to both remove and designate a successor for the authorized 
fiduciary, and does not refer to the power merely to designate a successor when a vacancy 
occurs. 
Other notice provisions under state law may also apply to a decanting.  Under Section 
813(a) of the Uniform Trust Code, a trustee shall keep the qualified beneficiaries of the trust 
reasonably informed about the administration of the trust and of the material facts necessary for 
them to protect their interests.  An exercise of the decanting power is a material fact.  If the 
second trust is newly created for purposes of decanting, state law may require notice of the 
creation of the trust to certain beneficiaries.  For example, Section 813 of the Uniform Trust 
Code requires a trustee, within 60 days after accepting a trusteeship, to notify the qualified 
beneficiaries of the acceptance and of the trustee’s name, address, and telephone number.  In 
addition, if the exercise of the decanting power results in a distribution of property, the 
distribution would be considered a disbursement that should be reported on the accounting of the 
first trust.  If the exercise of the decanting power results in the termination of the first trust, state 
law or the trust instrument may require a final accounting. 
Subsection (c)(7) entitles the Attorney General to notice of an exercise of the decanting 
power with respect to a trust containing a determinable charitable interest.  See Section 14(a)(1).   28 
Subsection (d) provides that notice need not be given to a person who is not known to the 
fiduciary or who is known to the fiduciary but cannot be located by the fiduciary after reasonable 
diligence.  An analogous term, “reasonable care,” is used in Section 1007 of the Uniform Trust 
Code.  Section 1007 provides that a trustee who has exercised reasonable care to ascertain the 
happening of an event that affects the administration of a trust is not liable for a loss resulting 
from the trustee’s lack of knowledge. 
Although the act does not limit the amount of time that may pass between the giving of 
notice and the exercise of the decanting power, if the exercise of the power does not occur within 
a reasonable period of time from the proposed effective date set forth in the notice, a new notice 
should be given with a new notice period.  Further, the authorized fiduciary’s duties to keep 
beneficiaries and interested persons informed about the trust may require the authorized fiduciary 
to inform such persons if the decanting is not completed as proposed or when the decanting has 
been completed. 
If after notice is given and before the decanting power is exercised, relevant facts change 
in a manner that entitles an additional person to receive notice, unless such additional person can 
be represented by another person who has already received notice, notice should be provided to 
such additional person.  A new notice period should begin to run, unless such additional person 
waives the notice period. 
Subsection (e) describes the items that must be included in the notice.  Subparagraph (1) 
requires that the notice specify the manner in which the authorized fiduciary intends to exercise 
the decanting power.  Depending upon the circumstances, the authorized fiduciary might 
describe the modifications being made, provide a comparison of the first trust and the second 
trust or, where the second trust is extensively different than the first trust, refer the notice 
recipient to the trust instruments.  As a best practice, it is desirable to tell each notice recipient in 
which capacity he or she is receiving the notice.  For example, a notice might state:  “You are 
receiving this notice because you are the settlor of Trust XYZ” or “You are receiving this notice 
because you are a qualified beneficiary of Trust XYZ.”  In the case of notice to an Attorney 
General, it is a best practice to indicate where in the instruments the determinable charitable 
interest may be found and whether the second trust will be administered under the law of a 
different state (see Section 14(e)). 
Although under Section 7(h) an exercise of the decanting power will not be ineffective 
because of the failure to provide the required notice to one or more persons, provided that the 
authorized fiduciary acted with reasonable care, the act does not override the court’s ability to 
address breaches of fiduciary duty and to fashion appropriate remedies. 
 [SECTION 8.  REPRESENTATION. 
(a) Notice to a person with authority to represent and bind another person under a first-
trust instrument or [this state’s trust code] has the same effect as notice given directly to the 
person represented.   29 
(b) Consent of or waiver by a person with authority to represent and bind another person 
under a first-trust instrument or [this state’s trust code] is binding on the person represented 
unless the person represented objects to the representation before the consent or waiver 
otherwise would become effective. 
(c) A person with authority to represent and bind another person under a first-trust 
instrument or [this state’s trust code] may file an application under Section 9 on behalf of the 
person represented. 
(d) A settlor may not represent or bind a beneficiary under this [act].] 
Legislative Note:  State law generally specifies when a beneficiary who is a minor or otherwise 
incapacitated may be represented by another party.  State law also may specify when an 
incapacitated settlor may be represented by another party.  These provisions with respect to 
trusts may be contained in the state’s trust code.  For example, Article 3 of the Uniform Trust 
Code provides rules for representation.  If state law does not already provide for representation 
of an incapacitated beneficiary or settlor, representation provisions should be included in the 
act. 
 
If this act is inserted into the state’s Uniform Trust Code, Section 8 may be omitted. 
 
Comment 
Subsection (a) provides that the first-trust instrument or general rules in the state’s trust 
code or other law determine who may receive notice of an exercise of the decanting power on 
behalf of a minor beneficiary or an incapacitated beneficiary, settlor, holder of a presently 
exercisable power of appointment or person with the right to remove or replace the authorized 
fiduciary.  It is similar to Section 301(a) of the Uniform Trust Code except that it expressly 
recognizes that if the first-trust instrument authorizes certain persons to receive notice on behalf 
of incapacitated beneficiaries or other persons, such rules should also apply for purposes of 
notice under Section 7. 
Subsection (b) provides that the first-trust instrument or general rules in the state’s trust 
code or other law determine who may waive the notice period under Section 7 or consent to 
certain modifications under Section 16 and Section 18.  It is similar to Section 301(b) of the 
Uniform Trust Code except that it expressly recognizes that if the first-trust instrument 
authorizes certain persons to consent on behalf of minor or incapacitated persons, such rules 
should also apply for purposes of waiving the notice period under Section 7 or consenting to 
modifications under Section 16 or Section 18. 
Subsection (c) makes clear that a person who represents another may file a court petition 
under Section 9 on behalf of the person represented.  This includes the Attorney General or other   30 
official with enforcement authority over charitable interests.  See Section 2(5) for the definition 
of “charitable interest.” 
Subsection (d) prohibits a settlor from representing a beneficiary.  Subsection (d) is 
similar to optional subsection (d) of Section 301 of the Uniform Trust Code, which was added to 
the Uniform Trust Code because of a concern that allowing a settlor to represent a beneficiary 
could cause the trust to be included in the settlor’s estate. 
 SECTION 9.  COURT INVOLVEMENT. 
(a) On application of an authorized fiduciary, a person entitled to notice under Section 
7(c), a beneficiary, or with respect to a charitable interest the [Attorney General] or other person 
that has standing to enforce the charitable interest, the court may: 
(1) provide instructions to the authorized fiduciary regarding whether a proposed 
exercise of the decanting power is permitted under this [act] and consistent with the fiduciary 
duties of the authorized fiduciary; 
(2) appoint a special fiduciary and authorize the special fiduciary to determine 
whether the decanting power should be exercised under this [act] and to exercise the decanting 
power; 
(3) approve an exercise of the decanting power; 
(4) determine that a proposed or attempted exercise of the decanting power is 
ineffective because: 
 (A) after applying Section 22, the proposed or attempted exercise does not 
or did not comply with this [act]; or  
 (B) the proposed or attempted exercise would be or was an abuse of the 
fiduciary’s discretion or a breach of fiduciary duty; 
(5) determine the extent to which Section 22 applies to a prior exercise of the 
decanting power; 
(6) provide instructions to the trustee regarding the application of Section 22 to a   31 
prior exercise of the decanting power; or 
(7) order other relief to carry out the purposes of this [act]. 
(b) On application of an authorized fiduciary, the court may approve: 
(1) an increase in the fiduciary’s compensation under Section 16; or 
(2) a modification under Section 18 of a provision granting a person the right to 
remove or replace the fiduciary. 
Legislative Note:  In a state with a limited-jurisdiction court, it may be necessary to grant the 
power to the court to order remedial action for an ineffective attempted decanting. 
In subsection (a), “Attorney General” is placed in brackets to accommodate a jurisdiction that 
grants enforcement authority over charitable trusts to another designated official. 
Comment 
Decanting by definition is an exercise of fiduciary discretion and is not an alternative 
basis for a court modification of the trust. 
The decanting power, however, is a very broad discretionary power.  Therefore, Section 9 
provides that the authorized fiduciary, any person who would be entitled to notice of the exercise 
of the decanting power, any beneficiary or the Attorney General or other official who has 
enforcement authority over a charitable interest in the first trust, may petition the court for 
certain purposes with respect to a prior decanting or a proposed decanting.  The persons who 
receive notice under Section 7 and who could petition the court include the settlor, the holder of 
a presently exercisable power of appointment over the first trust, each person who has a right to 
remove or replace the authorized fiduciary and each fiduciary of the first and second trusts.   
A successor beneficiary, even though such beneficiary is not entitled to notice under 
Section 7, could petition the court under Section 9.  Even though the Attorney General is entitled 
to notice under Section 7 only if there is a determinable charitable interest, the Attorney General 
may petition the court under Section 9 with respect to any charitable interest. 
Any such person may request instructions with respect to whether a proposed decanting 
complies with the act and is consistent with the fiduciary duties of the authorized fiduciary.  
Section 9(a)(1).  The authorized fiduciary need not have provided notice of a proposed decanting 
or even be the person proposing the decanting in order for the court to provide instructions.  Such 
an instruction, however, would not create in the authorized fiduciary a duty to decant. 
While generally the authorized fiduciary should decide whether or not to exercise the 
decanting power, and may seek instructions from the court when in doubt as to whether the 
proposed exercise is permitted and consistent with the authorized fiduciary’s fiduciary duties, 
there may be times when the exercise of the decanting power is appropriate but the authorized   32 
fiduciary cannot or should not be the person to exercise the power.  Under such circumstances 
the court may appoint a special fiduciary to determine if the decanting power should be exercised 
and, if so, to exercise the power.  Section 9(a)(2).  The terms of the appointment may limit the 
special fiduciary’s power to determine whether a proposed exercise is appropriate or may grant 
the special fiduciary broader power to determine the scope of a decanting.  The term of 
appointment may also limit the period of time during which the special fiduciary may act.  For 
example, assume a trust permits discretionary principal distributions to the settlor’s descendants 
subject to an ascertainable standard if a beneficiary is acting as trustee and subject to expanded 
discretion if a disinterested person is acting as trustee.  If a beneficiary is acting as trustee and 
believes that an exercise of the decanting power under Section 11 may be appropriate, the trustee 
could request that the court appoint a disinterested person as special fiduciary to determine 
whether the decanting power should be exercised and, if so, to exercise the power.  As another 
example, if the authorized fiduciary is a beneficiary of the first trust and it is appropriate to create 
a special-needs trust for another beneficiary, but the decanting might incidentally increase the 
authorized fiduciary’s interest in the trust, it may be advisable for the authorized fiduciary to 
request under subsection (a)(2) the appointment of a special fiduciary to decide whether to 
exercise the decanting power. 
The special fiduciary essentially temporarily steps into the office of the trustee or other 
fiduciary who has the power to make trust distributions (the “distribution fiduciary”).  If the 
special fiduciary, if acting as the distribution fiduciary, would have expanded distributive 
discretion, the court may authorize the special fiduciary to exercise the decanting power under 
Section 11.  If the special fiduciary, if acting as the distribution fiduciary, would have limited 
distributive discretion, the court may authorize the special fiduciary to exercise the decanting 
power under Section 12.  If the distribution fiduciary has no discretion to distribute principal, 
then the special fiduciary could not exercise the decanting power under Section 11 or 12, but 
could exercise the decanting power under Section 13. 
For example, assume A is acting as trustee of a trust that is required to distribute income 
to A and upon A’s death distributes to A’s descendants.  A special fiduciary cannot exercise the 
decanting power under Section 11 or Section 12 because the special fiduciary, if acting as 
trustee, has no distributive discretion over principal. 
Now assume that the trust also provides that if a person who is not a beneficiary is acting 
as trustee, such trustee may make discretionary distributions of principal to A for A’s health care.  
A special fiduciary who is not a beneficiary could be appointed and granted the authority to 
exercise the decanting power under Section 12. 
Alternatively, assume that the trust provides that if a person who is not a beneficiary is 
acting as trustee, such trustee may make discretionary distributions of principal to A for A’s best 
interests.  A special fiduciary who is not a beneficiary could be appointed and granted the 
authority to exercise the decanting power under Section 11. 
Any person described in Section 9(a) may request that the court approve an exercise of 
the decanting power.  Such approval should be granted if the decanting complies with this act 
and is not an abuse of the trustee’s discretion.   33 
A petition to the court may also request that the court determine whether an attempted 
decanting is ineffective because it did not comply with the act.  The court may also determine 
whether the remedial provisions of Section 22 apply to an attempted decanting and how such 
remedial provisions modify the second-trust instrument.  If a trust has been administered after an 
attempted decanting under the assumed terms of the second-trust instrument, but after applying 
Section 22 should have been administered on different terms, the court may also instruct the 
fiduciary on the corrective action that should be taken. 
For example, if an attempted decanting eliminated a noncontingent right to mandatory 
income distributions, and several years after the attempted decanting the income beneficiary of 
the first trust petitioned the court to apply Section 22 to the attempted decanting, the court might 
declare that the second trust must grant the income beneficiary such beneficiary’s mandatory 
income interest and might order a makeup distribution to the income beneficiary for the period 
the income was not paid. 
In addition, certain changes in a decanting require either approval by certain persons or 
court approval.  Under Section 16, certain increases in the compensation of the authorized 
fiduciary require either the consent of all qualified beneficiaries or court approval.  Under 
Section 18, modification of a power to remove or replace an authorized fiduciary requires the 
consent of the person holding such power (and, in some cases, consent of the qualified 
beneficiaries) or court approval. 
The court may, but need not, take any of the actions described in Section 9. 
SECTION 10.  FORMALITIES. An exercise of the decanting power must be made in 
a record signed by an authorized fiduciary.  The signed record must, directly or by reference to 
the notice required by Section 7, identify the first trust and the second trust or trusts and state the 
property of the first trust being distributed to each second trust and the property, if any, that 
remains in the first trust. 
Comment 
Once the authorized fiduciary has provided the requisite notice of a proposed decanting 
under Section 7 and the notice period has either passed or been waived as provided in Section 
7(f), then on or about the proposed effective date for the exercise of the decanting power the 
authorized fiduciary may effectuate the decanting by a signed record.  The notice (a) includes 
copies of the first-trust instrument and the second-trust instrument, (b) specifies the manner in 
which the decanting power would be exercised, including which property of the first trust is 
being distributed to each of the second trusts and which property, if any, remains in the first trust, 
and (c) specifies the proposed effective date for the decanting.  In the case of an exercise of the 
decanting power that is structured as a modification of the first trust, the signed record required 
by Section 10 may be the same instrument setting forth the terms of the modified trust.  Where 
the decanting is structured as a distribution to a separate second trust, generally the signed record   34 
required by Section 10 will be a separate instrument from the second-trust instrument. 
The decanting power can be exercised by either an actual distribution of property to one 
or more second trusts or by modifying the terms of the first trust to create the second trust with 
or without an actual distribution of property.  If the decanting power is exercised by modifying 
the terms of the first trust, the trustee could either treat the second trust created by such 
modification as a new trust, in which case the property of the first trust would need to be 
transferred to the second trust, or alternatively treat the second trust as a continuation of the first 
trust, in which case the property of the first trust would not need to be retitled. 
Other actions may be required to formally complete the transfer of property from the first 
trust to the second trust, such as retitling accounts, executing deeds, and signing assignments. 
 SECTION 11.  DECANTING POWER UNDER EXPANDED DISTRIBUTIVE 
DISCRETION. 
 (a) In this section: 
 (1) “Noncontingent right” means a right that is not subject to the exercise of 
discretion or the occurrence of a specified event that is not certain to occur.  The term does not 
include a right held by a beneficiary if any person has discretion to distribute property subject to 
the right to any person other than the beneficiary or the beneficiary’s estate. 
 (2) “Presumptive remainder beneficiary” means a qualified beneficiary other than 
a current beneficiary. 
 (3) “Successor beneficiary” means a beneficiary that is not a qualified beneficiary 
on the date the beneficiary’s qualification is determined.  The term does not include a person that 
is a beneficiary only because the person holds a nongeneral power of appointment. 
 (4) “Vested interest” means: 
 (A) a right to a mandatory distribution that is a noncontingent right as of 
the date of the exercise of the decanting power; 
 (B) a current and noncontingent right, annually or more frequently, to a 
mandatory distribution of income, a specified dollar amount, or a percentage of value of some or   35 
all of the trust property; 
 (C) a current and noncontingent right, annually or more frequently, to 
withdraw income, a specified dollar amount, or a percentage of value of some or all of the trust 
property; 
 (D) a presently exercisable general power of appointment; or 
 (E) a right to receive an ascertainable part of the trust property on the 
trust’s termination which is not subject to the exercise of discretion or to the occurrence of a 
specified event that is not certain to occur. 
 (b) Subject to subsection (c) and Section 14, an authorized fiduciary that has expanded 
distributive discretion over the principal of a first trust for the benefit of one or more current 
beneficiaries may exercise the decanting power over the principal of the first trust. 
 (c) Subject to Section 13, in an exercise of the decanting power under this section, a 
second trust may not: 
 (1) include as a current beneficiary a person that is not a current beneficiary of the 
first trust, except as otherwise provided in subsection (d); 
 (2) include as a presumptive remainder beneficiary or successor beneficiary a 
person that is not a current beneficiary, presumptive remainder beneficiary, or successor 
beneficiary of the first trust, except as otherwise provided in subsection (d); or 
 (3) reduce or eliminate a vested interest. 
 (d) Subject to subsection (c)(3) and Section 14, in an exercise of the decanting power 
under this section, a second trust may be a trust created or administered under the law of any 
jurisdiction and may: 
 (1) retain a power of appointment granted in the first trust;   36 
 (2) omit a power of appointment granted in the first trust, other than a presently 
exercisable general power of appointment; 
 (3) create or modify a power of appointment if the powerholder is a current 
beneficiary of the first trust and the authorized fiduciary has expanded distributive discretion to 
distribute principal to the beneficiary; and 
 (4) create or modify a power of appointment if the powerholder is a presumptive 
remainder beneficiary or successor beneficiary of the first trust, but the exercise of the power 
may take effect only after the powerholder becomes, or would have become if then living, a 
current beneficiary. 
 (e) A power of appointment described in subsection (d)(1) through (4) may be general or 
nongeneral.  The class of permissible appointees in favor of which the power may be exercised 
may be broader than or different from the beneficiaries of the first trust. 
 (f) If an authorized fiduciary has expanded distributive discretion over part but not all of 
the principal of a first trust, the fiduciary may exercise the decanting power under this section 
over that part of the principal over which the authorized fiduciary has expanded distributive 
discretion. 
Comment 
Noncontingent Right.  The term “noncontingent right” describes interests that are certain 
to occur.  A right is not noncontingent if it is subject to the occurrence of a specified event that is 
not certain to occur.  For example, if A’s children who survive A are to receive trust assets upon 
A’s death, the rights of A’s children are not noncontingent, because each must survive A to take 
and they may not survive A.  The rights of A’s children are not noncontingent regardless of 
whether the requirement of survival is expressed as a condition precedent or a condition 
subsequent.  Thus the result is the same if the gift upon A’s death is to A’s children in equal 
shares, but if any child predeceases A such child’s share shall be distributed to such child’s 
descendants in shares per stirpes. 
A right also is not a noncontingent right if it is subject to the exercise of discretion.  Thus 
if a trustee has discretion to make distributions to A and A’s descendants for their support and 
health care, the interests of A and A’s descendants are not noncontingent.  The result is the same   37 
even if the trust directs the trustee to make distributions to A and A’s descendants for their 
support and health care because the timing and amount of the distributions are subject to the 
trustee’s discretion. 
A right also is not noncontingent if a person has discretion to distribute the property 
subject to the interest to any person other than the beneficiary or the beneficiary’s estate.  Thus if 
a trust provides that all income shall be distributed annually to A, but gives the trustee discretion 
to distribute principal to B for B’s support and medical care, A’s right is not noncontingent. 
A current mandatory right to receive income, an annuity or a unitrust payment where the 
trustee has no discretion to make distributions to others is a noncontingent right. 
Presumptive Remainder Beneficiary.  “Presumptive remainder beneficiary” means a 
qualified beneficiary (see Section 2(20)) other than a current beneficiary (see Section 2(9)).  The 
presumptive remainder beneficiaries might be termed the first-line remainder beneficiaries.  
These are the beneficiaries who would become eligible to receive distributions were the event 
triggering the termination of a current beneficiary’s interest or of the trust itself to occur on the 
date in question.  Such a terminating event will often be the death or deaths of the current 
beneficiaries.  A person who would have a presently exercisable general power of appointment if 
the trust terminated on that date or if the interests of the current beneficiaries terminated on that 
date without causing the trust to terminate is a presumptive remainder beneficiary. 
Presumptive remainder beneficiaries can include takers in default of the exercise of a 
power of appointment.  The term may sometimes include the persons entitled to receive the trust 
property pursuant to the irrevocable exercise of an inter vivos power of appointment.  Because 
the exercise of a testamentary power of appointment is not effective until the testator’s death, the 
qualified beneficiaries do not include appointees under the will of a living person.  Nor would 
the term include the objects of an unexercised inter vivos power. 
Successor Beneficiary.  The term “successor beneficiary” means a beneficiary who has a 
future beneficial interest in a trust, vested or contingent, including a person who may become a 
beneficiary in the future by reason of inclusion in a class, other than a beneficiary who is a 
qualified beneficiary.  Thus it includes beneficiaries who might be termed “second line” or more 
remote remainder beneficiaries.  It also includes unborn or unascertained beneficiaries who are 
beneficiaries by reason of being members of a class.  It does not include, however, a person who 
is merely a holder of a power of appointment but not otherwise a beneficiary. 
Vested Interest.  “Vested interest” includes a right to a mandatory distribution that is a 
noncontingent right as of the date of the exercise of the decanting power.  Section 11(a)(4)(A).  
For example, if the trustee is required to distribute the trust principal to A when A attains age 30 
if A is then living, and A has attained age 30 but the trustee has not yet made the distribution, 
A’s right to receive the trust principal is a right to a mandatory distribution that is a 
noncontingent right.  If A is age 29, however, A’s right is not a noncontingent right because A 
must survive to age 30. 
The right to a mandatory distribution does not include a right to a distribution pursuant to 
a standard or a right to a distribution in the discretion of a fiduciary.  Thus a right to receive   38 
distributions for “support and health care,” or for “best interests” would not be a mandatory 
distribution right for purposes of Section 11. 
“Vested interest” also includes a current and noncontingent right, annually or more 
frequently, to a mandatory distribution of income, a specified dollar amount or a percentage of 
value of some or all of the trust properties.  Section 11(a)(4)(B).  Thus if A is currently entitled 
to all trust income payable annually, and the trustee has no discretion to not pay the income to A 
and no discretion to distribute principal to anyone other than A, A’s right to income is a vested 
interest.  A’s right to income is a vested interest even if the trustee has discretion to distribute 
principal to A.  The result is the same if instead of an income right, A has the right to receive a 
specified dollar amount or a percentage of value of trust assets.  A’s right is a vested interest 
even if the right will cease upon some future event, such as A’s death or a particular date, so long 
as the future event is not an exercise of fiduciary discretion.  A specified dollar amount includes 
a dollar amount that is dependent upon factors other than fiduciary discretion or specific events 
not certain to occur, such as the inflation rate.  A “vested interest” includes a current right to a 
unitrust distribution based on the value of certain or all trust assets. 
A fiduciary’s power to make equitable adjustments to income or principal, whether 
granted under the trust instrument or state law, does not make an income interest not mandatory 
or not noncontingent.  A fiduciary’s power to exclude certain assets in determining a unitrust 
distribution to attain an equitable result, whether granted under the trust instrument or state law, 
does not make a unitrust interest not mandatory or not noncontingent.  For example, a 
beneficiary’s current right to receive an annual distribution equal to 4% of the value of the trust 
principal is a vested interest even if the fiduciary has a right to exclude from the value of trust 
principal non-income producing assets. 
Even if all conditions to such right have been met, the decanting may eliminate current 
mandatory rights to income, annuity or unitrust distributions that have come into effect with 
respect to a beneficiary if the authorized fiduciary has discretion to make principal distributions 
to another beneficiary.  For example, if the first trust provides for mandatory income 
distributions to A, but permits the authorized fiduciary to make discretionary principal 
distributions to A, B or C for their best interests, the decanting may eliminate A’s mandatory 
income interest.  In such case the first trust indirectly gave the authorized fiduciary the ability to 
reduce or eliminate A’s income interest by making discretionary principal distributions to B or 
C. 
A right to receive mandatory payments less frequently than annually is not a vested 
interest.  For example, a right to receive 5% of the trust value every fifth year is not a vested 
interest, except with respect to any amounts currently payable.  As another example, a right to 
receive distributions of one-third of the trust principal at ages 30, 35 and 40 is not a vested 
interest if the beneficiary has not attained age 30.  If the beneficiary is age 30 but the trustee has 
not yet distributed the one-third payable at age 30, the beneficiary’s right to that one-third is a 
vested interest, but the beneficiary’s right to receive distributions at ages 35 and 40 is not a 
vested interest. 
“Vested interest” also includes a current and noncontingent right, annually or more 
frequently, to withdraw income, a specified dollar amount, or a percentage of value of some or   39 
all of the trust property.  Section 11(a)(4)(C).  Thus, for example, it makes no difference whether 
the trustee is required to distribute income annually or whether the beneficiary may withdraw 
income annually.  As another example, if B has a current right to withdraw annually the greater 
of $5,000 or 5% of the trust value each year, B’s right is a vested interest.  If B’s right to 
withdraw did not begin until B attained age 25 and B has not attained age 25, B’s right would not 
be a vested interest. 
“Vested interest” also includes a presently exercisable general power of appointment.  A 
power of appointment is presently exercisable if it is exercisable at the time in question.  
Typically, a presently exercisable power of appointment is exercisable at the time in question 
during the powerholder’s life and also at the powerholder’s death, e.g., by the powerholder’s 
will.  Thus, a power of appointment that is exercisable “by deed or will” is a presently 
exercisable power. 
A power to withdraw from a trust is a power of appointment.  See Restatement Third of 
Trusts § 56 comment b.  Thus if a beneficiary has already attained an age at which the 
beneficiary can withdraw all or a portion of the trust, the second trust may not modify or 
eliminate that right of withdrawal.  If a Crummey withdrawal power is still in effect with respect 
to a prior contribution to the trust, the second trust cannot modify or eliminate the Crummey 
withdrawal right. 
For example, if the trustee may make discretionary distributions to C and C’s 
descendants, C has a right to withdraw one-half of trust principal after attaining age 28, and C 
has attained age 28, C’s right is a vested interest under Section 11(a)(4)(D) even if the trustee has 
power to distribute trust principal to anyone other than C. 
“Vested interest” also includes a right to receive an ascertainable part of the trust property 
on the trust’s termination which is not subject to the exercise of discretion or to the occurrence of 
a specified event that is not certain to occur.  Thus if the trustee is to distribute income to F, and 
upon F’s death is to distribute the principal to G or G’s estate, G’s interest is a vested interest.  G 
would not have a vested interest if the trustee had discretion to distribute principal to F or if G 
was required to survive F to take the remainder interest.  Thus the right of a person to receive the 
trust property upon the termination of such trust if such person is then living would not be a 
vested interest.  Any interest with a condition is not a vested interest, regardless of whether the 
condition is a condition precedent or condition subsequent.  For example, A does not have a 
vested interest if upon termination the trust property passes to A or A’s estate, provided that A is 
then married or was married at the time of A’s prior death. 
Expanded Distributive Discretion Decanting.  Under Section 11 an authorized fiduciary 
who has expanded distributive discretion to distribute all or part of the principal of a trust to one 
or more of the current beneficiaries may exercise the decanting power over the principal subject 
to such expanded distributive discretion. 
“Expanded distributive discretion” is defined in Section 2(11).  When a trustee is granted 
expanded distributive discretion, that is an indication that the settlor intended to rely on the 
trustee’s judgment and discretion in making distributions.  The settlor’s faith in the trustee’s 
judgment supports the assumption that the settlor would trust the trustee’s judgment in making   40 
modifications to the trust instrument in light of changed circumstances including the 
beneficiary’s circumstances and changes in tax and other laws. 
The decanting power, like most discretionary distribution powers, can be exercised over 
all or part of the first trust.  If it is exercised over only part of the first trust, the second trust 
would need to be a separate trust and could not be a continuation of the first trust.  If the 
decanting power is exercised to distribute property of the first trust to more than one second 
trusts, then the second trusts (or at least all but one of the second trusts) would need to be 
separate trusts and could not be a continuation of the first trust. 
If the authorized fiduciary has expanded discretion over only part of the first trust, the 
authorized fiduciary may exercise the decanting power under this section only over such part.  
See Section 11(f).  With respect to the remainder of the trust, the authorized fiduciary may have 
the ability to decant under Section 12 or Section 13. 
The second trust may contain any terms permissible for a trust subject only to the 
restrictions found in the act.  Thus subject to subsections (c) and (f) of Section 11 and the other 
restrictions in Sections 14 through 20 and subject to the fiduciary duty in Section 4(a), the 
second trust may (1) eliminate (but not add) one or more current beneficiaries; (2) make a current 
beneficiary a presumptive remainder beneficiary or a successor beneficiary; (3) eliminate (but 
not add) one or more presumptive remainder and successor beneficiaries; (4) make a 
presumptive remainder beneficiary a successor beneficiary, or vice versa; (5) alter or eliminate 
rights that are not vested interests; (6) change the standard for distributions; (7) add or eliminate 
a spendthrift provision; (8) extend the duration of a trust (subject to Section 20); (9) change the 
jurisdiction of the trust and the law governing the administration of the trust (subject to Section 
14(e)); (10) eliminate, modify or add powers of appointment; (11) change the trustee or trustee 
succession provisions; (12) change the powers of the trustee; (13) change administrative 
provisions of the trust; (14) add investment advisors, trust protectors or other fiduciaries; (15) 
divide a trust into more than one trust; and (16) consolidate trusts.  The foregoing list merely 
provides examples and is not exhaustive. 
The second trust, however, cannot make a remainder beneficiary a current beneficiary.  
This prohibition on accelerating a remainder interest is included to avoid any argument under 
Internal Revenue Code Section 674 that the mere existence of a power to make a remainder 
beneficiary a current beneficiary causes the trust to be a grantor trust, whether or not the 
decanting power is ever exercised in such manner. 
Section 11(c)(3) prohibits the second trust from reducing or eliminating a vested interest.  
A vested interest is not reduced, however, just because other changes made as a result of a 
decanting may have incidental effects on the interest.  For example, a modification of the 
fiduciary’s investment powers or the manner of determining the fiduciary’s compensation may 
have incidental effects on a beneficiary’s interest, but such modifications do not reduce a vested 
interest. 
The restrictions in Section 11(c)(3) do not apply to a decanting under Section 13.  Section 
13(c)(2).    41 
Subsections (d) and (e) permit the second trust to retain or omit a power of appointment 
included in the first trust, or to create powers of appointment in one or more current beneficiaries 
of the first trust.  For example, if the first trust permits the authorized fiduciary to make 
discretionary distributions of income or principal to the settlor’s child A, and upon A’s death the 
remainder is allocated for the settlor’s descendants per stirpes, to be held in further trust for each 
such descendant, the second trust could grant A a lifetime and/or testamentary power, general or 
nongeneral.  The second trust could grant A a lifetime power to appoint to A’s descendants, 
spouse and charitable organizations and a testamentary power to appoint to A’s estate or to the 
creditors of A’s estate.  The second trust also could provide that each descendant of the settlor 
for whom a trust is established at A’s death will have an inter vivos or a testamentary, general or 
limited, power of appointment.  The second trust could even give A’s now living children, D and 
E, powers of appointment that they may exercise in their Wills, but that will only take effect 
upon A’s death or, if later, their deaths. 
Subsection (e) makes clear that persons who are not otherwise beneficiaries of the first 
trust may be permissible appointees of a power of appointment granted to a current beneficiary. 
Sometimes state law may provide more than one method for making the same 
modification to a trust.  For example, a combination of trusts or a division of a trust that would 
be permitted under Section 417 of the Uniform Trust Code may also be accomplished under this 
act through decanting.  When a desired modification could be accomplished by decanting or by 
another method, the trustee may select either method. 
 SECTION 12.  DECANTING POWER UNDER LIMITED DISTRIBUTIVE 
DISCRETION. 
(a) In this section, “limited distributive discretion” means a discretionary power of 
distribution that is limited to an ascertainable standard or a reasonably definite standard. 
(b) An authorized fiduciary that has limited distributive discretion over the principal of 
the first trust for benefit of one or more current beneficiaries may exercise the decanting power 
over the principal of the first trust. 
(c) Under this section and subject to Section 14, a second trust may be created or 
administered under the law of any jurisdiction.  Under this section, the second trusts, in the 
aggregate, must grant each beneficiary of the first trust beneficial interests which are 
substantially similar to the beneficial interests of the beneficiary in the first trust. 
 (d) A power to make a distribution under a second trust for the benefit of a beneficiary   42 
who is an individual is substantially similar to a power under the first trust to make a distribution 
directly to the beneficiary.  A distribution is for the benefit of a beneficiary if: 
 (1) the distribution is applied for the benefit of the beneficiary; 
 (2) the beneficiary is under a legal disability or the trustee reasonably believes the 
beneficiary is incapacitated, and the distribution is made as permitted under [this state’s trust 
code]; or 
 (3) the distribution is made as permitted under the terms of the first-trust 
instrument and the second-trust instrument for the benefit of the beneficiary. 
(e) If an authorized fiduciary has limited distributive discretion over part but not all of the 
principal of a first trust, the fiduciary may exercise the decanting power under this section over 
that part of the principal over which the authorized fiduciary has limited distributive discretion. 
Comment 
Limited Distributive Discretion.  “Limited distributive discretion” means a discretionary 
power of distribution that is limited to an ascertainable standard or a reasonably definite 
standard.  Section 12(a).  “Ascertainable standard” is defined in Section 2(2).  “Reasonably 
definite standard” is defined in Section 2(21).  “Limited distributive discretion” and “expanded 
distributive discretion” (see Section 2(11)) are mutually exclusive terms.  An authorized 
fiduciary who has expanded distributive discretion over principal may decant under Section 11.  
An authorized fiduciary who has limited distributive discretion over principal may decant under 
Section 12.  An authorized fiduciary who has no distributive discretion over principal, even if the 
authorized fiduciary has distributive discretion over income, may not decant under the act except 
as provided in Section 13. 
Substantially Similar Beneficial Interests.  When the authorized fiduciary has limited 
distributive discretion over principal, the authorized fiduciary may exercise the decanting power 
to effect modifications in administrative provisions, including trustee succession provisions, but 
may not materially change the dispositive provisions of the trust.  This section requires the 
beneficial provisions of the second trust to be substantially the same as in the first trust, because 
the settlor did not choose to give the authorized fiduciary expanded discretion.  Thus, for 
example, if a trust provides for principal distributions subject to an ascertainable standard to the 
settlor’s child, and upon the child’s death the remainder is to be distributed to Charitable 
Organization A, the decanting power cannot be exercised in a manner that substantially changes 
the interests of the child or of Charitable Organization A.  Nonetheless, the settlor did entrust the 
authorized fiduciary with some discretion over principal distributions indicating some confidence 
in the trustee’s judgment, justifying a limited decanting power in these situations.   43 
“Substantially similar” means that there is no material change in a beneficiary’s 
beneficial interests except as provided in subsection (d).  A distribution standard that was more 
restrictive or more expansive would not be substantially similar.  Thus if the first trust permitted 
distributions for support, health care and education, the beneficial interests would not be 
substantially similar if the second trust permitted distributions only for support and health care.  
If the first trust, however, permitted distributions for education without elaboration with respect 
to what was included within the term, the second trust might define education to include college, 
graduate school and vocational schools if otherwise consistent with applicable law. 
If the first trust requires that a trust be distributed at age 35, a second trust that permits 
the beneficiary to withdraw any part or all of the trust at any time after age 35 would be 
substantially similar.  A second trust that delayed the distribution to age 40 would not be 
substantially similar. 
Changes to a fiduciary’s administrative powers or investment powers, changes in a 
fiduciary, or changes in jurisdiction or the state law governing the administration of the trust, are 
not material changes in a beneficiary’s beneficial interests, even though such changes may have 
incidental effects on the beneficial interests.  For example, changing the trustee from one person 
to another could impact how the trustee exercises discretionary distribution authority, but is not a 
material change because the trustee’s discretion is subject to the same standard and the trustee is 
subject to fiduciary duties. 
Section 12(d), which permits distributions to be made for the benefit of the beneficiary 
instead of directly to such beneficiary, in part reflects existing law and in part expands existing 
law.  Section 816(21) of the Uniform Trust Code permits a trustee to pay an amount distributable 
to a beneficiary who is under a legal disability or who the trustee reasonably believes is 
incapacitated by paying it directly to the beneficiary, applying it for the beneficiary’s benefit, 
paying it to certain other persons on behalf of such beneficiary, or managing it as a separate fund 
on the beneficiary’s behalf subject to the beneficiary’s continuing right to withdraw the 
distribution.  Section 12(d)(1) permits an amount distributable to a beneficiary to be applied for 
the beneficiary’s benefit, but does not require that the beneficiary be under a legal disability or 
incapacitated.  Section 12(d)(2) permits an amount distributable to a beneficiary who is under a 
legal disability or whom the trustee reasonably believes is incapacitated to be paid as permitted 
under the state’s trust code.  Under the Uniform Trust Code, as noted above, the trustee may pay 
such amount to certain other persons such as a conservator or guardian on behalf of the 
beneficiary.  Section 12(d)(3) recognizes that the first-trust instrument may contain certain 
provisions authorizing the trustee to pay amounts distributable to beneficiaries to certain persons 
on their behalf or in certain ways.  If the second-trust instrument also contains the same 
provisions, they are another permissible way to make distributions to a beneficiary because they 
were authorized by the settlor. 
For example, if a trust requires that all income be distributed to A and permits the trustee 
to distribute principal to A for A’s support, the trustee may decant the trust to require that all 
trust income be held in an accumulated income fund under the trust agreement, which permits A 
to withdraw the accumulated income fund at any time and permits the trustee to use the 
accumulated income fund to directly pay A’s expenses.  This might be helpful, for example, if A 
was incapacitated, incarcerated or uninterested in managing the funds herself or himself.   44 
Section 12 is intended to permit a severance of a trust if the beneficial interests in the 
second trust, in the aggregate, are substantially similar to the beneficial interests in the first trust.  
For this purpose, an equal vertical division of a trust in which multiple beneficiaries have equal 
discretionary interests would usually be considered to be substantially similar.  For example, if a 
testamentary trust created by A provides for discretionary distributions of income and principal 
to A’s children for support, education and health care and A has three living children (B, C and 
D), the authorized fiduciary may exercise the decanting power under Section 12 to sever the trust 
into three equal trusts, one for each of B, C and D.  The beneficial interest of each child in the 
second trusts is different because before the severance each child could conceivably receive 
discretionary distributions of more than one-third of the first trust and after the severance each 
child may only receive distributions from such child’s second trust (one-third of the first trust).  
A child’s interest would usually be considered substantially similar, however, because the loss of 
the possibility of receiving distributions of more than one-third of the first trust is offset by the 
fact that after the severance the other children may not receive discretionary distributions from 
such child’s second trust.  A child’s interest after severance might not be considered substantially 
similar, however, if the first-trust instrument made clear that B’s health care needs should be 
given priority and it seemed likely that B’s health care needs would exceed one-third of the 
principal of the first trust. 
SECTION 13.  TRUST FOR BENEFICIARY WITH DISABILITY . 
 (a) In this section: 
 (1) “Beneficiary with a disability” means a beneficiary of a first trust who the 
special-needs fiduciary believes may qualify for governmental benefits based on disability, 
whether or not the beneficiary currently receives those benefits or is an individual who has been 
adjudicated [incompetent]. 
 (2) “Governmental benefits” means financial aid or services from a state, federal, 
or other public agency. 
 (3) “Special-needs fiduciary” means, with respect to a trust that has a beneficiary 
with a disability: 
 (A) a trustee or other fiduciary, other than a settlor, that has discretion to 
distribute part or all of the principal of a first trust to one or more current beneficiaries; 
 (B) if no trustee or fiduciary has discretion under subparagraph (A), a 
trustee or other fiduciary, other than a settlor, that has discretion to distribute part or all of the   45 
income of the first trust to one or more current beneficiaries; or 
 (C) if no trustee or fiduciary has discretion under subparagraphs (A) and 
(B), a trustee or other fiduciary, other than a settlor, that is required to distribute part or all of the 
income or principal of the first trust to one or more current beneficiaries. 
 (4) “Special-needs trust” means a trust the trustee believes would not be 
considered a resource for purposes of determining whether a beneficiary with a disability is 
eligible for governmental benefits. 
 (b) A special-needs fiduciary may exercise the decanting power under Section 11 over 
the principal of a first trust as if the fiduciary had authority to distribute principal to a beneficiary 
with a disability subject to expanded distributive discretion if: 
 (1) a second trust is a special-needs trust that benefits the beneficiary with a 
disability; and  
 (2) the special-needs fiduciary determines that exercise of the decanting power 
will further the purposes of the first trust. 
 (c) In an exercise of the decanting power under this section, the following rules apply: 
 (1) Notwithstanding Section 11(c)(2), the interest in the second trust of a 
beneficiary with a disability may: 
 (A) be a pooled trust as defined by Medicaid law for the benefit of the 
beneficiary with a disability under 42 U.S.C. Section 1396p(d)(4)(C)[, as amended]; or 
 (B) contain payback provisions complying with reimbursement 
requirements of Medicaid law under 42 U.S.C. Section 1396p(d)(4)(A)[, as amended]. 
 (2) Section 11(c)(3) does not apply to the interests of the beneficiary with a 
disability.   46 
 (3) Except as affected by any change to the interests of the beneficiary with a 
disability, the second trust, or if there are two or more second trusts, the second trusts in the 
aggregate, must grant each other beneficiary of the first trust beneficial interests in the second 
trusts which are substantially similar to the beneficiary’s beneficial interests in the first trust. 
Legislative Note: In subsection (a)(1), substitute for “incompetent”  the appropriate term for a 
judicial determination of disability or incompetency. 
In states in which the constitution, or other law, does not permit the phrase “as amended” when 
federal statutes are incorporated into state law, the phrase should be deleted in subsection 
(c)(1). 
Comment 
Section 13 permits an authorized fiduciary to exercise the decanting power over a trust 
that has a beneficiary with a disability to create a special-needs trust that governmental benefits 
programs may not consider a “resource” for purposes of the eligibility of the beneficiary with a 
disability for those benefits.  Many governmental benefit programs restrict eligibility for those 
programs to only persons of limited resources.  These resources may include any assets from 
which the beneficiary with a disability has the right to compel a distribution or a withdrawal.  
Special-needs trusts are drafted so as to limit the distribution rights of the beneficiary with a 
disability and thus better permit the beneficiary with a disability to qualify for governmental 
benefits.  Under Section 13 the authorized fiduciary may modify the dispositive provisions for 
the beneficiary with a disability even if the authorized fiduciary has no discretion to make 
distributions or only discretion over income. 
Beneficiary with a Disability.  “Beneficiary with a disability” means a beneficiary who 
the special-needs fiduciary believes may qualify for governmental benefits based on disability.  
Section 13(a)(1).  The beneficiary need not be adjudicated incompetent or totally incapacitated.  
The beneficiary need not be currently receiving governmental benefits based on disability.  Nor 
need it be certain that the beneficiary would qualify for such benefits but for the terms of the first 
trust.  The special-needs fiduciary need only have a reasonable belief that the decanting may 
permit the beneficiary to qualify for such benefits.  The governmental benefits must be ones, 
however, that are based on disability and not merely on financial need.  Thus a decanting 
intended to permit a beneficiary with no disability to qualify for a needs-based college 
scholarship is not permitted under Section 13. 
Governmental Benefits.  “Governmental benefits” means financial aid or services from a 
state, federal or other public agency.  Section 13(a)(2).  It does not include benefits from a 
private entity. 
Special-Needs Fiduciary.  Because the term “authorized fiduciary” is limited to a 
fiduciary who has the power to make discretionary distributions of principal and Section 13 is 
intended to permit a fiduciary to decant even if the fiduciary does not have discretion over   47 
principal, Section 13 uses the separate term “special-needs fiduciary” to identify the fiduciary 
who has the power to decant.  If there is no fiduciary who has discretion over principal, the 
special-needs fiduciary is the fiduciary with discretion over income, or if none, the fiduciary who 
is directed to make distributions.  Section 13(a)(3). 
Special-Needs Trust.  “Special-needs trust” means a trust the trustee believes would not 
be considered a resource for purposes of determining whether a beneficiary with a disability is 
eligible for governmental benefits based on disability.  Section 13(a)(4). 
Furtherance of Purposes of Trust.  The exercise of the decanting power must be in 
furtherance of the purposes of the first trust.  Section 13(b)(2).  Thus the decanting must 
effectuate better the settlor’s broader purposes.  In most cases, if the first trust did not anticipate 
the beneficiary’s disability and the settlor’s broader purpose was to provide for the beneficiary’s 
support, a decanting that would permit the beneficiary with a disability to qualify for 
governmental benefits while still being eligible to receive discretionary distributions from the 
trust would further the purposes of the trust. 
For example, assume the first trust was created and funded by A, requires all income to 
be distributed to the beneficiary after age 21, permits the trustee to distribute principal to the 
beneficiary pursuant to an ascertainable standard for the beneficiary’s support, permits the 
beneficiary to withdraw the trust principal at age 30, grants the beneficiary a testamentary 
general power of appointment, and upon the beneficiary’s death distributes any unappointed 
property per stirpes to A’s descendants then living.  If the beneficiary is age 25 and is disabled, 
the authorized fiduciary may exercise the decanting power to distribute the principal of the first 
trust to a trust that provides only for distributions to the beneficiary in the trustee’s absolute 
discretion and upon the beneficiary’s death distributes the remaining trust assets per stirpes to 
A’s descendants then living.  The exercise of the decanting power may eliminate the 
beneficiary’s right to income, the beneficiary’s prospective right to withdraw the trust at age 30 
and the beneficiary’s power of appointment.  The second trust may not, however, change the 
remainder beneficiaries.  Section 13(c)(3). 
The result is the same if the beneficiary is age 31 and thus has a right to withdraw the 
trust assets, because Section 13(c)(2) provides that Section 11(c)(3) does not apply to the interest 
of the beneficiary with a disability. 
If in the above example the trustee had no discretion to distribute principal, but was either 
required to distribute income or had discretion to distribute income for A’s support, the 
authorized fiduciary could still decant to a special-needs trust.  The trustee would be considered 
the special-needs fiduciary under Section 13(a)(3). 
The decanting, however, must further the purposes of the first trust.  Section 13(b)(2).  
For example, if a trust was created solely for the purpose of funding college education for the 
settlor’s grandchildren, the authorized fiduciary may not decant to pay for the support of a 
grandchild who is a beneficiary with a disability.  Conceivably, however, a trust for the 
education at all levels of the settlor’s grandchildren might be decanted to a trust that permits 
distributions to a grandchild who is a beneficiary with a disability for such grandchild’s 
occupational therapy and vocational training.   48 
Pooled or Payback Trust.  The second trust may be a pooled trust or a payback trust.  
Section 13(c)(1).  For example, assume a trust was funded by the beneficiary, directly or 
indirectly, and provides for distributions of income to the beneficiary until age 30 and then 
provides for the remainder of the trust to be distributed to the beneficiary.  The beneficiary is age 
28.  The authorized fiduciary may exercise the decanting power, and the second trust may be a 
“pooled trust” or a payback trust.  Section 13(c)(1).  The act does not require that the second trust 
be a “pooled trust” or a payback trust, but other state law may impose such a requirement. 
Other Beneficial Interests Must Be Substantially Similar.  Subsection (c)(3) generally 
requires that any beneficial interests of beneficiaries other than the beneficiary with a disability 
be substantially similar to their interests in the first trust except to the extent they are affected by 
changes to the interest of the beneficiary with a disability.  The beneficiary’s disability justifies 
permitting a modification of the interest of the beneficiary with a disability even when the trustee 
has limited or no discretion, but does not justify otherwise changing the interests of other 
beneficiaries.  The modifications to the interest of the beneficiary with a disability, however, 
might affect the amount or timing of the other beneficiaries’ interests. 
Thus if the first trust has more than one current beneficiary, one of whom is a beneficiary 
with a disability, the special-needs fiduciary may decant under Section 11 as if the special-needs 
fiduciary had expanded discretion to distribute principal to the beneficiary with a disability, but 
may not alter the interests of the other beneficiaries except to the extent they are affected by the 
changes to the interest of the beneficiary with a disability.  For example, assume the first trust 
was created and funded by A, continues for the rule against perpetuities period, requires that 
income be distributed per stirpes to A’s descendants, and permits discretionary distributions of 
principal to A’s descendants pursuant to an ascertainable standard.  The exercise of the decanting 
power might, for example, distribute part of the principal of the first trust to a special-needs trust 
solely for the benefit of the beneficiary with a disability (the “Special-Needs Trust”) and 
distribute the remaining principal to a trust solely for the benefit of the nondisabled beneficiaries 
(the “Non-Special-Needs Trust”), the terms of which are otherwise identical to the terms of the 
first trust.  The Special-Needs Trust might give the trustee absolute discretion to make 
distributions to the beneficiary with a disability.  Upon the death of the beneficiary with a 
disability, however, the remaining assets of the Special-Needs Trust must be distributed to the 
Non-Special-Needs Trust, because the decanting cannot change the interests of the non-disabled 
beneficiaries, except to the extent they are affected by the changes to the interest of the 
beneficiary with a disability.  The non-disabled beneficiaries’ remainder interests may be 
affected, for example, because the trustee of the Special-Needs Trust may make distributions to 
the beneficiary with a disability in the trustee’s absolute discretion and is not limited by an 
ascertainable standard.  The Non-Special-Needs Trust must have the same terms as the first trust, 
except that it may modify or eliminate the interest of the beneficiary with a disability.  So, for 
example, the Non-Special-Needs Trust might provide that no distributions would be made to the 
beneficiary with a disability unless the Special-Needs Trust was exhausted. 
SECTION 14.  PROTECTION OF CHARITABLE INTEREST. 
(a) In this section: 
 (1) “Determinable charitable interest” means a charitable interest that is a right to   49 
a mandatory distribution currently, periodically, on the occurrence of a specified event, or after 
the passage of a specified time and which is unconditional or will be held solely for charitable 
purposes. 
 (2) “Unconditional” means not subject to the occurrence of a specified event that 
is not certain to occur, other than a requirement in a trust instrument that a charitable 
organization be in existence or qualify under a particular provision of the United States Internal 
Revenue Code of 1986[, as amended,] on the date of the distribution, if the charitable 
organization meets the requirement on the date of determination. 
(b) If a first trust contains a determinable charitable interest, [the Attorney General] has 
the rights of a qualified beneficiary and may represent and bind the charitable interest. 
(c) If a first trust contains a charitable interest, the second trust or trusts may not: 
 (1) diminish the charitable interest; 
 (2) diminish the interest of an identified charitable organization that holds the 
charitable interest; 
 (3) alter any charitable purpose stated in the first-trust instrument; or 
 (4) alter any condition or restriction related to the charitable interest. 
(d) If there are two or more second trusts, the second trusts shall be treated as one trust 
for purposes of determining whether the exercise of the decanting power diminishes the 
charitable interest or diminishes the interest of an identified charitable organization for purposes 
of subsection (c). 
(e) If a first trust contains a determinable charitable interest, the second trust or trusts that 
include a charitable interest pursuant to subsection (c) must be administered under the law of this 
state unless:   50 
 (1) [the Attorney General], after receiving notice under Section 7, fails to object 
in a signed record delivered to the authorized fiduciary within the notice period; 
 (2) [the Attorney General] consents in a signed record to the second trust or trusts 
being administered under the law of another jurisdiction; or 
 (3) the court approves the exercise of the decanting power. 
(f) This [act] does not limit the powers and duties of the [Attorney General] under law of 
this state other than this [act]. 
Legislative Note: In states in which the constitution, or other law, does not permit the phrase 
“as amended” when federal statutes are incorporated into state law, the phrase should be 
deleted in subsection (a)(2). 
In subsections (b), (e), and (f), “Attorney General” is placed in brackets to accommodate a 
jurisdiction that grants enforcement authority over charitable trusts to another designated 
official. 
Comment 
 
The Uniform Trust Decanting Act does not permit the decanting of a trust held solely for 
charitable purposes (a “wholly charitable trust”).  See Section 3(b).  While a split interest trust 
such as a charitable remainder trust or a charitable lead trust is not a wholly charitable trust, in 
almost all cases the trustee of such a trust would not have discretion to distribute principal to a 
current beneficiary and therefore there would be no authorized fiduciary (see Section 2(3)) who 
would have authority to exercise the decanting power under Section 11 or Section 12. 
Other trusts that could be decanted under Sections 11, 12 or 13, however, may contain 
charitable interests.  Section 14 imposes special protections for charitable interests.  When a 
charitable interest is a “determinable charitable interest,” Section 14 gives the Attorney General 
(or other official with enforcement authority over charitable interests) the rights of a qualified 
beneficiary and restricts the ability to decant to change the law governing the trust’s 
administration.  Generally, a determinable charitable interest is a charitable interest not subject to 
fiduciary discretion or any significant contingencies. 
Determinable Charitable Interest.  An interest must meet three requirements to be a 
determinable charitable interest.  Section 14(a)(1).  First, the interest must be a charitable 
interest.  See Section 2(5).  Determinable charitable interests are a subset of charitable interests.  
Thus a remote contingent interest cannot be a determinable charitable interest. 
Second, a determinable interest must be a right to a mandatory distribution.  A mandatory 
distribution is a right that is not subject to the exercise of discretion.  The mandatory distribution 
may be a right to income, principal or both.  A mandatory distribution may be a right to a current   51 
distribution, for example, where a charitable organization is entitled to a certain portion of trust 
principal on a date that has already occurred and the distribution has not yet been made.  A 
mandatory distribution also includes a right to periodic distributions of income, a specific dollar 
amount or a percentage of value of some or all of the trust property.  A mandatory distribution 
also includes a right to receive an ascertainable part of the trust property currently or on the 
occurrence of a specified event or after the passage of a specified time. 
This requirement would be met, for example, if a trust required the trustee to distribute to 
charitable organizations or for charitable purposes one-half of the trust’s net income annually or, 
alternatively, one percent of the value of the trust’s assets annually.  It would also be met if the 
trustee was required to distribute ten percent of the trust principal to charitable organizations or 
for charitable purposes ten years after the settlor’s death or alternatively upon the death of the 
settlor’s surviving spouse.  This requirement would not be met if the charitable distribution was 
subject to the trustee’s discretion. 
A mandatory distribution would also include a right of withdrawal held by a charitable 
organization. 
The third and final requirement for a determinable charitable interest is that the charitable 
interest either must be unconditional or must in all events be held for charitable purposes.  
Unconditional generally means not subject to the occurrence of a specified event that may not 
occur.  For example, assume the trustee is to distribute $100,000 annually to the Ornithology 
Institute, a charitable organization, but only if it uses the funds to search for the ivory billed 
woodpecker, and if it does not so use the funds, to Resurrect Extinct Species, a charitable 
organization, but only if it uses the funds to recreate the ivory billed woodpecker from genetic 
material, and if it does not so use the funds, to Woods for Woodpeckers, a charitable 
organization.  The individual interests of Ornithology Institute, Resurrect Extinct Species, and 
Woods for Woodpeckers are each conditional.  The charitable interest to receive $100,000 
annually, in the aggregate, meets the third requirement because in all events it will be held for 
charitable purposes for one of the three charitable organizations. 
A charitable interest is conditional (i.e., not an unconditional interest) if the trustee has 
discretion to make or not make the distribution.  For example, if the trustee has discretion to 
make distributions of income to Manors for Meerkats, a charitable organization, the charitable 
interest is not unconditional.  The charitable interest would not be a determinable charitable 
interest unless it would in all events be held for charitable purposes.  For example, if the trustee 
was required to distribute all income annually to Manors for Meerkats or to such other charitable 
organization as the trustee selected for the benefit of wildlife of the Kalahari Desert, the 
charitable interest is determinable even though the interest of Manors for Meerkats is not 
unconditional. 
A charitable interest, however, would not be conditional merely because the trustee’s 
exercise of discretion in favor of other beneficiaries could affect the charitable interest.  For 
example, if the trustee is required to distribute $200,000 annually to Lonely George Research 
Fund and has discretion to distribute principal to the settlor’s children, the charitable interest is 
unconditional because so long as there are sufficient funds in the trust the charitable distribution 
must be made.  As another example, assume the trustee had discretion to distribute income and   52 
principal to the settlor’s children, and upon the death of the surviving child the remainder was to 
be distributed to Gone with the Wolves, a charitable organization.  The interest of Gone with the 
Wolves is a determinable charitable interest, even though it may be reduced, or even eliminated, 
by the trustee’s exercise of discretion in favor of the settlor’s children. 
An interest held by a charitable organization is not conditional merely because it is 
subject to the requirement that the organization be in existence at the time the distribution is to 
be made.  Further, an interest held by a charitable organization is not conditional merely because 
the organization must qualify as a charitable organization under a particular provision of the 
Internal Revenue Code, if the organization so qualifies on the date of determination. 
For example, assume a trust provides for distributions for the education of the settlor’s 
children and upon the youngest living child attaining age 28 distributes to Whale Whisperers, if 
it is then in existence and contributions to it qualify for a federal income tax charitable 
deduction.  The interest of Whale Whisperers is unconditional if at the time of the determination 
Whale Whisperers is in existence and contributions to it qualify for the federal income tax 
deduction. 
Attorney General Rights.  Subsection (b) provides that if the first trust contains a 
determinable charitable interest, the Attorney General (or other official with enforcement 
authority over charitable interests) may represent the interest and has all the rights of a qualified 
beneficiary.  The Attorney General is entitled to notice under Section 7(c)(7).  The Attorney 
General may petition the court under Section 9, consent to a change in the compensation of an 
authorized fiduciary under Section 16 or consent to a change in the identity of the person who 
may remove or replace the authorized fiduciary under Section 18. 
If the decanting changes the jurisdiction of a trust containing a determinable charitable 
interest, the Attorney General may block the decanting by objecting, even without petitioning the 
court, unless the court approves the decanting.  Section 14(e). 
If the determinable charitable interest is held by an identified charitable organization, the 
organization is a qualified beneficiary, has the rights of a qualified beneficiary and may represent 
and bind itself.  In such a case, either the Attorney General or the organization could consent to a 
change in the compensation of an authorized fiduciary under Section 16 or consent to a change in 
the identity of the person who may remove or replace the authorized fiduciary under Section 18.  
If one of the Attorney General or the organization consented, but the other affirmatively 
objected, the other could petition the court under Section 9 for a determination. 
Preservation of Charitable Interests.  Although Section 14(b) gives the Attorney General 
the rights of a qualified beneficiary only when a charitable interest is determinable, Section 14(c) 
applies to all charitable interests whether or not determinable.  If the first trust contains a 
charitable interest, whether or not determinable, the second trust may not diminish such interest.  
Section 14(c)(1).  If the interest is held by an identified charitable organization, the second trust 
may not change the organization.  Section 14(c)(2).  If the first-trust instrument sets forth a 
particular charitable purpose, the second trust may not change the charitable purpose.  Section 
14(c)(3).  If the first trust imposes certain conditions or restrictions on the charitable gift, the 
second trust cannot change the conditions or restrictions.  Section 14(c)(4).   53 
If a charitable trust indicates a particular charitable purpose, the exercise of the decanting 
power may not change the charitable purpose.  Section 14(c)(3).  Thus if the first trust provides 
that upon A’s death the remainder will be paid to Companion Animals for the benefit and 
protection of dogs, the second trust may not change the purpose of the charitable gift to the 
benefit of cats.  As another example, if the first trust provides that upon A’s death the remainder 
will be distributed to such charities as the trustee selects for the purpose of preserving habitat for 
blue footed boobies, the second trust cannot change the charitable purpose to the protection of 
polar bears. 
If an authorized fiduciary has limited discretion to distribute principal and exercises the 
decanting power under Section 12, Section 12(c) requires that the second trusts must grant each 
beneficiary of the first trust, including charitable organizations, beneficial interests that are 
substantially similar to such beneficiary’s interests in the first trust.  If the first trust contains a 
charitable interest that is not held by an identified charitable organization, Section 12(c) does not 
apply but Section 14(c) requires that the second trust may not diminish the charitable interest and 
that any stated charitable purpose must remain the same. 
For example, assume a trust permits discretionary income and principal distributions to 
the settlor’s children for their support and health care, requires that the trustee distribute $25,000 
each year to one or more charitable organizations selected by the trustee for the purpose of caring 
for stray, neglected and abused large dogs, gives the trustee discretion to make additional 
distributions to charitable organizations for the same purpose, and upon the death of the settlor’s 
last surviving child the principal is to be distributed to charitable organizations selected by the 
trustee for the same purpose.  The trustee has limited discretion to distribute principal and 
therefore may decant under Section 12, but not Section 11.  The exercise of the decanting power 
may change administrative provisions and trustee provisions, but may not alter the beneficial 
interests of the children.  Because the charitable interests are not held by an identified charitable 
organization, they are not subject to Section 12(c).  Section 14(c), however, requires that the 
second trust not diminish the charitable interests to the $25,000 annual distributions, to receive 
discretionary distributions and to the remainder interest.  In addition, Section 14(c) requires that 
the charitable purpose remain the same.  Thus the second trust could not change the charitable 
purpose to supporting dog parks for small dogs. 
If the trust was as described above except that the trustee had discretion to make 
distributions to the children for their best interests, the trustee could exercise the decanting power 
under Section 11.  Thus the trustee could eliminate or reduce the interest of one or more of the 
settlor’s children.  The decanting could not, however, diminish the charitable interests because 
Section 14(c) requires that the charitable interest not be diminished.  The trustee could not, for 
example, grant a power of appointment to a child because such a power would diminish the 
charitable interests. 
If a trust gave the trustee expanded discretion to make distributions to the settlor’s 
children for best interests, and upon the death of the surviving child provided for the remaining 
assets to be distributed to Howl at the Moon, a charitable organization for the peaceful co-
existence of wolves and humans, the authorized fiduciary could not exercise the decanting power 
to provide that each child would receive an equal share of the trust assets when the youngest 
child attained age 25, because that would diminish the charitable interest.  The authorized   54 
fiduciary also could not exercise the decanting power to change the charitable remainder 
beneficiary from Howl at the Moon to another charitable organization.  By contrast, the 
authorized fiduciary could exercise the decanting power to provide that when the youngest child 
attained age 25 the trust would be distributed to Howl at the Moon, because that would enhance 
the charitable interest. 
Subsection (c)(4) prohibits altering any condition or restriction related to the charitable 
interest.  For example, if the first trust requires that the trustee consult with certain persons 
before making distributions or provide reports to certain persons, or gives enforcement rights to 
certain persons to ensure the charitable purpose is fulfilled, the second trust may not change such 
provisions. 
Some state Attorneys General (or other officials charged with protecting charitable 
interests) may be concerned that trusts with charitable interests will be moved out of their 
jurisdiction by decanting.  Section 14(e) addresses this concern by requiring that the second trust 
be administered under the law of the enacting state unless the court approved the decanting or the 
Attorney General either approved the decanting or, after receiving notice, failed to object within 
the notice period. 
Subsection (f) makes clear that the Uniform Trust Decanting Act does not limit the 
powers and duties of the Attorney General under other law of the state, whether statutory or 
common law.  For example, other law of the state may give the Attorney General the right to sue 
for breach of fiduciary duties with respect to charitable interests. 
SECTION 15.  TRUST LIMITATION ON DECANTING. 
(a) An authorized fiduciary may not exercise the decanting power to the extent the first-
trust instrument expressly prohibits exercise of: 
 (1) the decanting power; or 
 (2) a power granted by state law to the fiduciary to distribute part or all of the 
principal of the trust to another trust or to modify the trust. 
(b) Exercise of the decanting power is subject to any restriction in the first-trust 
instrument that expressly applies to exercise of: 
 (1) the decanting power; or 
 (2) a power granted by state law to a fiduciary to distribute part or all of the 
principal of the trust to another trust or to modify the trust. 
(c) A general prohibition of the amendment or revocation of a first trust, a spendthrift   55 
clause, or a clause restraining the voluntary or involuntary transfer of a beneficiary’s interest 
does not preclude exercise of the decanting power.   
(d) Subject to subsections (a) and (b), an authorized fiduciary may exercise the decanting 
power under this [act] even if the first-trust instrument permits the authorized fiduciary or 
another person to modify the first-trust instrument or to distribute part or all of the principal of 
the first trust to another trust. 
(e) If a first-trust instrument contains an express prohibition described in subsection (a) or 
an express restriction described in subsection (b), the provision must be included in the second-
trust instrument. 
Comment 
A trust instrument may expressly preclude the exercise of a decanting power under the 
act or any similar state statute with respect to the entire trust or with respect to one or more 
provisions of the trust.  See Section 15(a).  The exercise of a decanting power, however, is not 
prohibited by a statement that the trust is irrevocable or unamendable, or by a spendthrift 
provision.  See Section 15(c).  In order to preclude the exercise of the decanting power, the first-
trust instrument must expressly refer to the act or to a power granted by state law to the fiduciary 
to distribute part or all of the principal of the trust to another trust or to modify the trust.  For 
example, assume a first-trust instrument states:  “There shall always be a trustee who is an 
attorney or accountant.”  That sentence alone would not prohibit the exercise of the decanting 
power to eliminate that requirement.  If the first-trust instrument, however, also stated that “this 
provision may not be modified by the exercise of any decanting power,” then the exercise of the 
decanting power to modify that provision would be prohibited by Section 15(a). 
Any restriction in the first-trust instrument that expressly applies to decanting is honored.  
Thus, for example, a restriction in the first-trust instrument that requires court approval of any 
decanting that accelerates the distribution of trust assets would be enforced.  As another example, 
a restriction requiring approval of any decanting by a particular third party would also be 
enforced. 
An irrevocable trust may provide in the trust instrument a mechanism for modifying the 
trust, for example, by granting a trust protector the power to modify the trust.  The fact that a 
trust instrument provides such a mechanism for modification does not preclude the application of 
this act.  Any requirements or restrictions contained in the trust instrument for such modification 
mechanism do not apply to an exercise of a decanting power under this act unless such 
requirements or restrictions expressly apply to an exercise of a decanting power under this act or 
a similar state statute.   56 
If the first-trust instrument contains a restriction on decanting, the provision must be 
included in the second-trust instrument.  Section 15(e).  This provision is intended to prevent 
serial decanting in which the first decanting removes the restriction on changing a particular 
provision in the first-trust instrument, and the second decanting then changes such provision. 
 SECTION 16.  CHANGE IN COMPENSATIO N. 
(a) If a first-trust instrument specifies an authorized fiduciary’s compensation, the 
fiduciary may not exercise the decanting power to increase the fiduciary’s compensation above 
the specified compensation unless: 
 (1) all qualified beneficiaries of the second trust consent to the increase in a 
signed record; or  
 (2) the increase is approved by the court. 
(b) If a first-trust instrument does not specify an authorized fiduciary’s compensation, the 
fiduciary may not exercise the decanting power to increase the fiduciary’s compensation above 
the compensation permitted by [this state’s trust code] unless: 
 (1) all qualified beneficiaries of the second trust consent to the increase in a 
signed record; or  
 (2) the increase is approved by the court. 
(c) A change in an authorized fiduciary’s compensation which is incidental to other 
changes made by the exercise of the decanting power is not an increase in the fiduciary’s 
compensation for purposes of subsections (a) and (b). 
Comment 
An exercise of the decanting power generally is an action taken by the authorized 
fiduciary that does not require beneficiary consent or court approval.  The purpose of requiring 
beneficiary consent or court approval to a change in the compensation of the authorized fiduciary 
is to place a check on an authorized fiduciary increasing its own compensation by decanting.  In 
this context it does not seem necessary to require the consent of all beneficiaries.  Obtaining the 
consent of qualified beneficiaries, who would generally be immediately impacted by a change in 
compensation, should be sufficient.   57 
If the first-trust instrument specifies the authorized fiduciary’s compensation, the 
decanting may not increase the fiduciary’s compensation without either the consent of all 
qualified beneficiaries of the second trust or court approval.  Section 16(a).  This subsection 
applies whether the increase in compensation would result from omitting the provision in the 
trust instrument specifying compensation, modifying such provision or replacing such provision 
with a different provision.  If it is unclear whether a change in method of calculating 
compensation would result in an increase, either court approval or consent of all qualified 
beneficiaries should be obtained. 
If the first-trust instrument does not specify the authorized fiduciary’s compensation, the 
decanting may not increase the compensation above the compensation permitted in the trust code 
of the enacting state without either the consent of all qualified beneficiaries or court approval.  
Section 16(b). 
Section 16 expressly does not prohibit an increase in compensation arising incidentally 
because of other changes made by the exercise of the decanting power.  For example, any 
increase in the compensation of the authorized fiduciary because the second trust may last longer 
than the first trust is incidental.  Also incidental are any increases in compensation that may arise 
because the second trust may have a greater value in the future than the first trust would have 
had, for example, because property is retained in the trust longer or smaller distributions are 
made.  Other incidental increases in the compensation of the authorized fiduciary may occur 
because of changes in investments, changes in the law governing the administration of the trust, 
changes in the identity of the authorized fiduciary, or changes in the duties of the authorized 
fiduciary. 
 In many cases the consideration of a proposed decanting or the implementation of a 
decanting is fairly seen as an exercise of a discretionary fiduciary power that does not warrant 
any additional compensation for the authorized fiduciary.  In some cases, however, the 
authorized fiduciary may be required to spend an extraordinary amount of time in evaluating a 
potential exercise of the decanting power, particularly when an exercise of the power is 
suggested by a beneficiary, or in exercising the decanting power.  In such cases, and regardless 
of whether the authorized fiduciary ultimately exercises the decanting power, the authorized 
fiduciary may be entitled to additional compensation under the trust instrument or under state 
law.  See Section 708 of the Uniform Trust Code.  In the absence of explicit authority on the 
appropriate amount of any such compensation, such compensation should be reasonable 
considering the relevant factors, including the time devoted to the decanting and the degree of 
difficulty.  See Restatement Third of Trusts Section 38 comment c.  The authorized fiduciary 
may also be entitled to have reasonable expenses related to evaluating a potential exercise of the 
decanting power or in exercising the decanting power paid from the first trust.  See Section 709 
of the Uniform Trust Code. 
 SECTION 17.  RELIEF FROM LIABILITY AND INDEMNIFICATION. 
(a) Except as otherwise provided in this section, a second-trust instrument may not 
relieve an authorized fiduciary from liability for breach of trust to a greater extent than the first-  58 
trust instrument. 
(b) A second-trust instrument may provide for indemnification of an authorized fiduciary 
of the first trust or another person acting in a fiduciary capacity under the first trust for any 
liability or claim that would have been payable from the first trust if the decanting power had not 
been exercised. 
(c) A second-trust instrument may not reduce fiduciary liability in the aggregate. 
(d) Subject to subsection (c), a second-trust instrument may divide and reallocate 
fiduciary powers among fiduciaries, including one or more trustees, distribution advisors, 
investment advisors, trust protectors, or other persons, and relieve a fiduciary from liability for 
an act or failure to act of another fiduciary as permitted by law of this state other than this [act]. 
Comment 
An authorized fiduciary should not be permitted to decant in order to insert in the second-
trust instrument a provision directly exculpating the authorized fiduciary or indemnifying the 
authorized fiduciary except to the extent such provision was contained in the first-trust 
instrument or applicable law would have provided such exculpation or indemnification.  
Nonetheless, decanting may appropriately reduce the authorized fiduciary’s liability indirectly.  
For example, if the second trust is subject to the law of a different state, the law governing the 
second trust may provide additional protection to the authorized fiduciary. 
The terms of the second trust may reduce an authorized fiduciary’s liability indirectly, for 
example, by modifying the rules for approving accounts or expressly permitting the retention of 
certain property.  While such provisions may not violate Section 16, they could under certain 
circumstances violate the authorized fiduciary’s general fiduciary duties.  For example, while it 
may be appropriate in the second trust to expressly permit the retention of a residence used by a 
current beneficiary of the trust, it may not be appropriate to permit the retention of all of the 
current trust property without any liability. 
Subsection (b) recognizes that the trustee of the first trust may be unwilling to distribute 
the assets of the first trust to the second trust unless the trustee is indemnified for any liability or 
claim that may become payable from the first trust after its assets are distributed.  Subsection (b) 
is consistent with Section 27, which provides that decanting does not relieve the trust property 
from any liability that otherwise attaches to the trust property.  The indemnification described in 
subsection (b) may be contained in the second-trust instrument or may be contained in the record 
exercising the decanting power. 
An authorized fiduciary can decant to a trust that divides the trustee responsibilities (i.e.,   59 
jobs) among various parties, but cannot eliminate the fiduciary duties that accompany those jobs.  
To the extent that the second trust assigns a fiduciary responsibility and the fiduciary duty that 
accompanies such responsibility to a particular fiduciary, the other fiduciaries may be relieved 
from liability for the actions of that particular fiduciary.  For example, an investment advisor can 
be appointed and the authorized fiduciary can be relieved of fiduciary liability for the investment 
decisions to the extent permitted by the law of the enacting state so long as the investment 
advisor is acting in a fiduciary capacity and has fiduciary liability for the investment decisions.  
Section 17(c), (d). 
 
 SECTION 18.  REMOVAL OR REPLACEMENT OF AUTHORIZED 
FIDUCIARY. An authorized fiduciary may not exercise the decanting power to modify a 
provision in a first-trust instrument granting another person power to remove or replace the 
fiduciary unless: 
 (1) the person holding the power consents to the modification in a signed record and the 
modification applies only to the person; 
 (2) the person holding the power and the qualified beneficiaries of the second trust 
consent to the modification in a signed record and the modification grants a substantially similar 
power to another person; or 
 (3) the court approves the modification and the modification grants a substantially similar 
power to another person. 
Comment 
Section 18 authorizes a modification of a trustee removal provision only with either court 
approval or the consent of the person currently holding the right to remove or replace the trustee.  
The power to remove a fiduciary is a power to remove the fiduciary without the fiduciary’s 
consent regardless of whether the remover has the power to designate the successor fiduciary.  
The power to replace a fiduciary is the power to remove the fiduciary and to designate the 
successor for the fiduciary without the consent of the fiduciary. 
Unless the qualified beneficiaries also consent to such change, the person currently 
holding the right to remove the authorized fiduciary may only consent to the modification of the 
right with respect to himself or herself and cannot consent to the modification of such right with 
respect to any successor remover.  Section 18(1).  For example, if a trust provides that the 
authorized fiduciary may be removed by X (the “current remover”), so long as X is living and 
not incapacitated, and after X is deceased or incapacitated, by Y, X may consent to a 
modification that would permit the authorized fiduciary to be removed only by the joint   60 
agreement of X and Z and only with 90 days’ prior notice, but such modification would not 
affect Y’s power of removal after X is deceased or incapacitated unless Y also consents to the 
modification or unless the qualified beneficiaries consent to such change. 
Alternatively, the removal power may be modified by the current remover and the 
qualified beneficiaries if the modification grants a substantially similar removal right to another 
person.  Section 18(2).  In the previous example, X (the current remover) and the qualified 
beneficiaries could consent to a modification that would permit the authorized fiduciary to be 
removed by Z, or if Z were not willing and able to act, by W.  Y, the successor remover named 
in the first-trust instrument, would not need to consent to such modification if X and the 
qualified beneficiaries consent to it. 
Alternatively, the power to remove or replace the authorized fiduciary may be modified if 
the court approves the modification and the modification grants a substantially similar power to 
another person.  Section 18(3). 
In the case of a modification with the consent of the qualified beneficiaries or with court 
approval, the modification must grant a substantially similar power to another person.  A power 
to remove a fiduciary only for cause would not be substantially similar to a power to remove a 
fiduciary for any reason.  A power to remove a fiduciary only after the fiduciary has attained age 
75 or served for ten years is not substantially similar to a power to remove the fiduciary at any 
time.  A power to replace a fiduciary is not substantially similar unless it contains substantially 
the same restrictions on who may serve as the replacement fiduciary.  For example, a power to 
remove a fiduciary and replace the fiduciary with any person would not be substantially similar 
to a power to remove the fiduciary and replace the fiduciary with a person who is not related or 
subordinate to the settlor. 
In exercising the decanting power to designate a different person to remove and replace 
the trustee, the authorized trustee should be alert to the tax consequences if the person so 
designated is not independent for tax purposes. 
 SECTION 19.  TAX-RELATED LIMITATIONS. 
(a) In this section: 
(1) “Grantor trust” means a trust as to which a settlor of a first trust is considered 
the owner under 26 U.S.C. Sections 671 through 677[, as amended,] or 26 U.S.C. Section 679[, 
as amended]. 
(2) “Internal Revenue Code” means the United States Internal Revenue Code of 
1986[, as amended]. 
(3) “Nongrantor trust” means a trust that is not a grantor trust.   61 
(4) “Qualified benefits property” means property subject to the minimum 
distribution requirements of 26 U.S.C. Section 401(a)(9)[, as amended,], and any applicable 
regulations, or to any similar requirements that refer to 26 U.S.C. Section 401(a)(9) or the 
regulations. 
(b) An exercise of the decanting power is subject to the following limitations: 
(1) If a first trust contains property that qualified, or would have qualified but for 
provisions of this [act] other than this section, for a marital deduction for purposes of the gift or 
estate tax under the Internal Revenue Code or a state gift, estate, or inheritance tax, the second-
trust instrument must not include or omit any term that, if included in or omitted from the trust 
instrument for the trust to which the property was transferred, would have prevented the transfer 
from qualifying for the deduction, or would have reduced the amount of the deduction, under the 
same provisions of the Internal Revenue Code or state law under which the transfer qualified. 
(2) If the first trust contains property that qualified, or would have qualified but 
for provisions of this [act] other than this section, for a charitable deduction for purposes of the 
income, gift, or estate tax under the Internal Revenue Code or a state income, gift, estate, or 
inheritance tax, the second-trust instrument must not include or omit any term that, if included in 
or omitted from the trust instrument for the trust to which the property was transferred, would 
have prevented the transfer from qualifying for the deduction, or would have reduced the amount 
of the deduction, under the same provisions of the Internal Revenue Code or state law under 
which the transfer qualified. 
(3) If the first trust contains property that qualified, or would have qualified but 
for provisions of this [act] other than this section, for the exclusion from the gift tax described in 
26 U.S.C. Section 2503(b)[, as amended], the second-trust instrument must not include or omit a   62 
term that, if included in or omitted from the trust instrument for the trust to which the property 
was transferred, would have prevented the transfer from qualifying under 26 U.S.C. Section 
2503(b)[, as amended].  If the first trust contains property that qualified, or would have qualified 
but for provisions of this [act] other than this section, for the exclusion from the gift tax 
described in 26 U.S.C. Section 2503(b)[, as amended,] by application of 26 U.S.C. Section 
2503(c)[,as amended], the second-trust instrument must not include or omit a term that, if 
included or omitted from the trust instrument for the trust to which the property was transferred, 
would have prevented the transfer from qualifying under 26 U.S.C. Section 2503(c)[, as 
amended]. 
(4) If the property of the first trust includes shares of stock in an S corporation, as 
defined in 26 U.S.C. Section 1361[, as amended,] and the first trust is, or but for provisions of 
this [act] other than this section would be, a permitted shareholder under any provision of 
26 U.S.C. Section 1361[, as amended], an authorized fiduciary may exercise the power with 
respect to part or all of the S-corporation stock only if any second trust receiving the stock is a 
permitted shareholder under 26 U.S.C. Section 1361(c)(2)[, as amended].  If the property of the 
first trust includes shares of stock in an S corporation and the first trust is, or but for provisions 
of this [act] other than this section would be, a qualified subchapter-S trust within the meaning of 
26 U.S.C. Section 1361(d)[, as amended], the second-trust instrument must not include or omit a 
term that prevents the second trust from qualifying as a qualified subchapter-S trust. 
(5) If the first trust contains property that qualified, or would have qualified but 
for provisions of this [act] other than this section, for a zero inclusion ratio for purposes of the 
generation-skipping transfer tax under 26 U.S.C. Section 2642(c)[, as amended,] the second-trust 
instrument must not include or omit a term that, if included in or omitted from the first-trust   63 
instrument, would have prevented the transfer to the first trust from qualifying for a zero 
inclusion ratio under 26 U.S.C. Section 2642(c)[, as amended]. 
(6) If the first trust is directly or indirectly the beneficiary of qualified benefits 
property, the second-trust instrument may not include or omit any term that, if included in or 
omitted from the first-trust instrument, would have increased the minimum distributions required 
with respect to the qualified benefits property under 26 U.S.C. Section 401(a)(9)[, as amended,] 
and any applicable regulations, or any similar requirements that refer to 26 U.S.C. Section 
401(a)(9)[, as amended] or the regulations.  If an attempted exercise of the decanting power 
violates the preceding sentence, the trustee is deemed to have held the qualified benefits property 
and any reinvested distributions of the property as a separate share from the date of the exercise 
of the power and Section 22 applies to the separate share. 
(7) If the first trust qualifies as a grantor trust because of the application of 26 
U.S.C. Section 672(f)(2)(A)[, as amended,] the second trust may not include or omit a term that, 
if included in or omitted from the first-trust instrument, would have prevented the first trust from 
qualifying under 26 U.S.C. Section 672(f)(2)(A)[, as amended]. 
(8) In this paragraph, “tax benefit” means a federal or state tax deduction, 
exemption, exclusion, or other benefit not otherwise listed in this section, except for a benefit 
arising from being a grantor trust.  Subject to paragraph (9), a second-trust instrument may not 
include or omit a term that, if included in or omitted from the first-trust instrument, would have 
prevented qualification for a tax benefit if: 
 (A) the first-trust instrument expressly indicates an intent to qualify for the 
benefit or the first-trust instrument clearly is designed to enable the first trust to qualify for the 
benefit; and   64 
 (B) the transfer of property held by the first trust or the first trust qualified, 
or but for provisions of this [act] other than this section, would have qualified for the tax benefit. 
(9) Subject to paragraph (4): 
 (A) except as otherwise provided in paragraph (7), the second trust may be 
a nongrantor trust, even if the first trust is a grantor trust; and 
 (B) except as otherwise provided in paragraph (10), the second trust may 
be a grantor trust, even if the first trust is a nongrantor trust. 
(10) An authorized fiduciary may not exercise the decanting power if a settlor 
objects in a signed record delivered to the fiduciary within the notice period and: 
 (A) the first trust and a second trust are both grantor trusts, in whole or in 
part, the first trust grants the settlor or another person the power to cause the first trust to cease to 
be a grantor trust, and the second trust does not grant an equivalent power to the settlor or other 
person; or 
 (B) the first trust is a nongrantor trust and a second trust is a grantor trust, 
in whole or in part, with respect to the settlor, unless: 
 (i) the settlor has the power at all times to cause the second trust to 
cease to be a grantor trust; or  
 (ii) the first-trust instrument contains a provision granting the 
settlor or another person a power that would cause the first trust to cease to be a grantor trust and 
the second-trust instrument contains the same provision. 
Legislative Note: In states in which the constitution, or other law, does not permit the phrase 
“as amended” when federal statutes are incorporated into state law, the phrase should be 
deleted in subsection (a)(1), (2) and (4) and subsection (b)(3) through (7). 
   65 
Comment 
Certain tax benefits granted under the Internal Revenue Code (the “Code”) or state law 
are dependent upon a trust containing specific provisions.  For example, a qualified terminable 
interest property (“QTIP”) marital trust or general power of appointment marital trust requires 
that the surviving spouse be entitled for life to all income, and a general power of appointment 
marital trust also requires that the surviving spouse have a general power of appointment 
exercisable alone and in all events.  If a trustee had the power to decant the trust in a manner that 
deprived the surviving spouse of the requisite income interest, or in the case of a general power 
of appointment marital trust, the requisite general power of appointment, then arguably the trust 
would not qualify for the marital deduction from the inception of the trust.  Similarly, it is 
important to ensure that charitable lead trusts and charitable remainder trusts cannot be modified 
in a way that arguably would prevent them from qualifying for the charitable deduction or that 
would reduce the amount of that deduction at their inception. 
Grantor Trust.  For purposes of this section, a grantor trust means a trust as to which a 
settlor of the first trust is considered the owner for income tax purposes under the Internal 
Revenue Code.  Section 19(a)(1).  The term does not include a trust over which someone other 
than the settlor (e.g., a beneficiary) is treated as the owner under Code section 678.  A 
“nongrantor trust” is a trust that is not a grantor trust.  Section 19(a)(3). 
Marital Deduction.  Subsection (b)(1) protects the marital deduction.  For example, for 
property to qualify as qualified terminable interest property, the surviving spouse must have a 
qualifying income interest for life and a QTIP election must be made.  Code § 2056(b)(7)(B)(i).  
The surviving spouse has a qualifying income interest for life if the surviving spouse is entitled 
to all the income from the property payable annually or at more frequent intervals and no person 
has a power to appoint any part of the property to any person other than the surviving spouse.  
Code § 2056(b)(7)(B)(ii).  If the first trust is a trust with respect to which a QTIP election was 
made, subsection (b)(1) prohibits decanting the property to a trust that does not give the 
surviving spouse a qualifying income interest for life.  For example, if the trustee had expanded 
discretion to distribute principal to the surviving spouse, the trustee could not decant to give the 
surviving spouse a lifetime power of appointment in favor of descendants.  In addition, both 
Section 11(c)(3) and Section 19(b)(1) would prohibit the trustee from decanting in a manner that 
would alter the surviving spouse’s income interest. 
As another example, assume the first trust qualified for the marital deduction under Code 
Section 2056(b)(5) because the surviving spouse is entitled for life to all the income, the 
surviving spouse has a testamentary power of appointment in favor of her estate, and no person 
has any power to appoint other than to the surviving spouse, and the trustee also has a power to 
make discretionary distributions to the surviving spouse subject to expanded discretion.  
Subsection (b)(1) prohibits decanting to a second trust that does not give the surviving spouse a 
right to all income or that gives any person a power to appoint to anyone other than the surviving 
spouse.  Subsection (b)(1) also requires that the second trust qualify for the marital deduction 
under the same section of the Code, Section 2056(b)(5).  It is not sufficient that the second trust 
qualify for the marital deduction under another section of the Code.  Although Code Section 
2056(b)(5) requires that the trust give the surviving spouse a power to appoint to either herself or 
her estate, the second trust could give the surviving spouse a lifetime power to appoint to herself   66 
instead of a testamentary power in favor of her estate, or could expand her testamentary power to 
include persons other than her estate as potential appointees, because the second trust would still 
qualify for the marital deduction under Code Section 2056(b)(5).  If the first trust, however, gave 
the surviving spouse a lifetime general power of appointment, the authorized fiduciary could not 
decant in a manner that eliminated such power of appointment.  Section 11(c)(3). 
Charitable Deduction.  Section 19(b)(2) protects the charitable deduction.  The act does 
not apply to wholly charitable trusts.  Section 3(b).  While a split interest trust such as a 
charitable remainder trust or charitable lead trust would not be a wholly charitable trust, in 
almost all cases the trustee of such a trust would not have discretion to distribute principal to a 
current beneficiary and therefore there would not be an authorized fiduciary (see Section 2(3)) 
who would have authority to exercise the decanting power under Section 11 or Section 12.  In 
the rare case in which a split interest charitable trust could be decanted, Section 19(b)(2) requires 
that the second trust qualify for the charitable deduction under the same provision of the Internal 
Revenue Code or state law. 
Subject to the provisions of Section 14, Section 19(b)(2) does not prohibit the 
modification or omission of a future gift to a charitable organization even if such gift, if made, 
would result in a future charitable deduction. 
Gift Tax Annual Exclusion.  Code Section 2503(b) grants a gift tax annual exclusion for 
gifts of a “present interest.”  Present interests are often created in trusts by granting the 
beneficiary a Crummey right of withdrawal over contributions to the trust.  If a trustee could 
decant in a manner that prematurely terminated a beneficiary’s existing Crummey right of 
withdrawal over a prior contribution to the trust, then arguably the contribution would not 
qualify for the gift tax annual exclusion.  The restriction in Section 11(c)(3) prohibiting the 
modification or elimination of a presently exercisable power of appointment also protects the 
annual exclusion for a prior gift to a Crummey trust. 
Code Section 2503(c) provides another method for qualifying gifts to a trust for the gift 
tax annual exclusion.  Code Section 2503(c) permits a gift tax annual exclusion for a gift to a 
trust for an individual under age 21 provided that the property and its income may be expended 
for the benefit of the donee before attaining age 21, to the extent not so expended passes to the 
donee upon attaining age 21, and, in the event of the donee’s death, is payable to the estate of the 
donee or pursuant to a general power of appointment. 
Assume, for example that the first trust permitted distributions of income and principal 
subject to expanded discretion to A, provided that the trust property should be distributed to A at 
age 21 and directed that the trust be distributed to A’s estate if A died prior to age 21.  A is age 
19.  The authorized fiduciary could decant to a second trust that, instead of distributing the 
property to A at age 21, provided A a right to withdraw the trust property for 60 days and that, 
instead of distributing the property to A’s estate, gave A a general testamentary power of 
appointment.  Such a decanting is permitted because the second trust would still qualify under 
Code Section 2503(c).  The authorized fiduciary could not decant to a trust that did not permit A 
to withdraw the assets until age 30 or that neither gave A a testamentary general power of 
appointment nor directed distribution of the property to A’s estate.   67 
S Corporation Stock.  Under Code Section 1361, only certain types of trusts are permitted 
to own S corporation stock.  If the first trust owns S corporation stock, the second trust must also 
qualify to own S corporation stock under Code Section 1361(c)(2).  If the first trust qualifies 
because it is an electing small business trust (an “ESBT”), the second trust may either be an 
ESBT or qualify to hold S corporation stock because it is a grantor trust or a qualified subchapter 
S trust (a “QSST”).  Similarly, if the first trust owns S corporation stock and is a grantor trust, 
the second trust may qualify to hold S corporation stock by being a grantor trust, an ESBT or a 
QSST. 
Subsection (b)(4) imposes a more stringent rule if the first trust is a QSST.  In order for a 
trust to qualify as a QSST, (a) the terms of the trust must require that during the life of the 
current income beneficiary there shall be only one income beneficiary and (b) all of the income 
must be distributed to such beneficiary.  Code § 1361(d)(3).  Thus it may be important that a 
trust intended to qualify as a QSST not be permitted to be decanted into a trust that would not 
qualify as a QSST.  If the first trust owns S corporation stock and qualifies as an S corporation 
shareholder because it is a QSST, subsection (b)(4) requires that the second trust also be a QSST.  
If the first trust is a QSST, it is not sufficient that the second trust qualify to hold S corporation 
stock under another provision of the Code.  If the authorized fiduciary had the power to modify a 
trust intended to qualify as a QSST to a trust that did not so qualify, the trust would not be a 
QSST from its inception. 
GST “Annual Exclusion” Gifts.  Code Section 2642(c) grants a zero inclusion ratio, 
essentially a “GST annual exclusion,” to gifts that qualify for the gift tax annual exclusion but 
imposes two additional requirements for gifts to trusts.  First, the trust must be only for a single 
individual and second, if the individual dies before the termination of the trust, the property of 
the trust must be included in the gross estate of such individual.  Thus while gifts to trusts for 
multiple beneficiaries could qualify for the gift tax annual exclusion through the use of Crummey 
withdrawal rights, such gifts generally would not qualify for the GST annual exclusion.  The 
Code Section 2642(c) restriction requiring a trust be for a single individual for such individual’s 
life could be violated through decanting if the decanting permitted a remainder beneficiary to 
receive distributions prior to the individual’s death.  Section 19(b)(5) prohibits such a 
modification.  The requirement that the trust be included in the gross estate of the individual 
could perhaps be violated by decanting to a trust that was not includible in the beneficiary’s 
gross estate.  Section 19(b)(5) prohibits such a decanting. 
Qualified Benefits.  Complicated rules determine when the life expectancy of a trust 
beneficiary can be considered in determining the required minimum distribution rules when a 
trust is the beneficiary of a qualified retirement plan or IRA.  These rules are found in Code 
Section 401(a)(9) and the corresponding regulations, and in other Code sections that refer to 
Section 401(a)(9).  For example, with IRAs, Code Section 408(a)(6) states:  “Under regulations 
prescribed by the Secretary, rules similar to the rules of section 401(a)(9) and the incidental 
death benefit requirements of section 401(a) shall apply to the distribution of the entire interest 
of an individual for whose benefit the trust is maintained.” 
Under the rules in Code Section 401(a)(9), only trusts with certain provisions and 
restrictions permit the life expectancy of the beneficiary to be used to determine required 
minimum distributions.  If a trustee could decant to a trust that would not meet these   68 
requirements, then arguably the old trust would not qualify from the inception to use the life 
expectancy of the beneficiary. 
Subsection (b)(6) applies not only to any trust that is currently the beneficiary of an 
individual retirement account (“IRA”) or qualified benefit, but also to any successor trust.  The 
need to apply subsection (b)(6) to successor trusts is demonstrated by the following example.  
Assume Trust A is the beneficiary of Parent’s $100,000 IRA.  Child is the current beneficiary of 
Trust A and upon Child’s death the assets of Trust A will be distributed to Trusts X and Y for 
Child’s children.  Trust A is not a “conduit trust,” but qualified to take IRA distributions over 
Child’s life expectancy because Trust A, and Trusts X and Y, have only individuals as 
beneficiaries and all future beneficiaries must be younger than Child.  If Trusts X and Y 
permitted the exercise of a decanting power in any way that could result in the addition of 
charities or individuals older than Child as beneficiaries or permissible appointees, Trust A 
would not have qualified to take IRA distributions over Child C’s life expectancy.  Therefore, 
the restrictions on decanting must apply to Trusts X and Y, as well as to Trust A.  Trusts X and 
Y are indirect beneficiaries of the qualified benefit property. 
If an attempted decanting violates subsection (b)(6), the qualified benefit property is 
deemed to be held as a separate share as of the date of the exercise of the decanting power.  
Holding the qualified benefit property as a separate share permits the remedial rules of Section 
22 to apply only with respect to the qualified benefit property and its proceeds. 
Foreign Grantor Trusts.  Generally, the grantor trust rules apply only to a “grantor” who 
is a citizen or resident of the United States or a domestic corporation.  An exception to this rule 
applies if (a) the foreign grantor has the power to revest title to the trust property in the grantor 
and such power is exercisable (1) solely by the grantor without the approval or consent of any 
other person or (2) with the consent of a related or subordinate party who is subservient to the 
grantor, or (b) distributions may be made only to the grantor and the grantor’s spouse during the 
life of the grantor.  If a foreign trust qualifies as a grantor trust because of Code Section 
672(f)(2)(A), subsection (b)(7) provides that the decanting power cannot be exercised to a 
second trust that does not meet the requirements of Code Section 672(f)(2)(A). 
Catch-all.  Subsection (b)(8) is a catch-all provision intended to preserve any tax benefits 
not specifically listed in Section 19 for which the first trust qualified if the first-trust instrument 
expressly indicates an intent to qualify for the tax benefit or is clearly designed to qualify for the 
tax benefit.  Note that subsection (b)(8) does not address any tax benefits for which the trust may 
qualify in the future.  For example, assume that the first trust was a credit shelter trust that was 
not subject to federal estate tax at the death of the first to die of a married couple because of the 
decedent’s federal exclusion.  Assume that an independent person may make discretionary 
distributions to the surviving spouse and descendants pursuant to expanded discretion.  Also 
assume that the credit shelter trust was designed so that it would not be included in the surviving 
spouse’s estate.  The authorized fiduciary could decant and the second trust could grant the 
surviving spouse a general power of appointment that would cause inclusion in the surviving 
spouse’s estate.  Although the credit shelter trust was designed to be excluded from the surviving 
spouse’s estate, such tax benefit is one that would occur, if at all, in the future at the surviving 
spouse’s death; it is not a tax benefit claimed in the past.  Therefore subsection (b)(8) does not 
prohibit such a modification.  If the settlor’s purposes include saving taxes, and causing inclusion   69 
in the spouse’s estate may save more taxes by causing a basis adjustment at the surviving 
spouse’s death even though the trust assets would then be included in the surviving spouse’s 
estate, then such a decanting may be appropriate and is not prohibited by subsection (b)(8). 
Grantor Trusts.  Subsection (b)(9) expressly permits an exercise of the decanting power 
to change the income tax status of the trust from a grantor trust to a nongrantor trust or vice 
versa.  Although, absent subsection (b)(9), grantor trust status generally might be viewed as a tax 
benefit of the first trust, grantor trust status is treated differently under the act because the grantor 
does not necessarily intend that the grantor trust status be maintained until the grantor’s death 
and because other desirable modifications of the trust may result in a loss of grantor trust status. 
An exercise of the decanting power may cause a nongrantor trust to become a grantor 
trust either as a primary purpose of the exercise of the decanting power or as an incidental 
consequence of other changes made by the decanting.  Subsection (b)(9)(B).  It would be 
fundamentally unfair, however, to permit a decanting to impose on the settlor liability for the 
second trust’s income taxes if the settlor objected to such liability.  Therefore subsection 
(b)(10)(B) permits the settlor to block the decanting by objection during the notice period unless 
the settlor has the power to cause the second trust to cease to be a grantor trust.  The settlor 
receives prior notice of the exercise of the decanting power under Section 7(c)(1). 
Where the first trust is a grantor trust, often the settlor or another person has the power to 
cause the trust to cease to be a grantor trust.  This power permits the settlor or someone acting on 
the settlor’s behalf to relieve the settlor of the income tax liability for the trust.  If the second 
trust is a grantor trust and does not contain the same provisions permitting the grantor trust 
treatment to be “turned off,” the settlor may block the proposed decanting by objecting during 
the notice period.  Subsection (b)(10)(A). 
If a portion of a trust is a grantor trust and the remaining portion is a nongrantor trust, 
subsection (b)(10) applies to the portion that is a grantor trust. 
 SECTION 20.  DURATION OF SECOND TRUST. 
(a) Subject to subsection (b), a second trust may have a duration that is the same as or 
different from the duration of the first trust. 
(b) To the extent that property of a second trust is attributable to property of the first trust, 
the property of the second trust is subject to any rules governing maximum perpetuity, 
accumulation, or suspension of the power of alienation which apply to property of the first trust. 
Comment 
To implement the public policy of the state law applicable to the first trust, subsection (b) 
requires that any maximum perpetuity, accumulation, or suspension-of-the-power-of-alienation 
period (collectively referred to as a “perpetuities rule”) applicable to the first trust apply to the   70 
second trust to the extent its assets are attributed to the first trust.  This rule is also supported by 
pragmatic considerations.  An exercise of a decanting power could inadvertently violate a 
perpetuities rule applicable to the first trust if the second trust does not comply with the same 
perpetuities rule.  Even in states that have abolished the maximum perpetuity rule, the state may 
still impose another perpetuities rule (e.g., a suspension-of-the-power-of-alienation rule), the first 
trust may still be subject to a rule against perpetuities under prior law or the first trust may be 
subject to a rule against perpetuities under the law of a different state.  Further, if a trust is 
grandfathered from generation-skipping transfer (“GST”) tax or has an inclusion ratio less than 
one, decanting to a trust that does not comply with the same rule against perpetuities period (or a 
federal rule against perpetuities period) may have adverse GST consequences. 
Thus if the first trust was created in a state with a traditional rule against perpetuities, the 
authorized fiduciary may not exercise the decanting power to change the governing law to a state 
with no rule against perpetuities and to eliminate the rule against perpetuities applicable to the 
first trust. 
Where the maximum term of the first trust is measured by reference to lives in being on 
the date the first trust became irrevocable, Section 20 does not preclude the second trust from 
using an expanded class of measuring lives so long as the expanded class were in being on the 
date the first trust became irrevocable.  For example, assume the first trust is subject to State A’s 
trust duration rule, which is a traditional rule against perpetuities that requires that an interest in a 
trust vest within twenty-one years of the last to die of lives in being when the trust became 
irrevocable.  The first trust contains a perpetuities savings clause that requires the trust to 
terminate twenty-one years after the death of the survivor of the settlor’s descendants living 
when the first trust was created.  The second trust may replace the perpetuities savings clause 
with a provision that requires the trust to terminate twenty-one years after the death of the 
survivor of the descendants of any grandparent of the settlor who were living when the first trust 
was created. 
As another example, assume the first trust is subject to State A’s trust duration rule, 
which is a traditional rule against perpetuities, but which permits a trust to opt out of the rule 
against perpetuities.  The first trust does not opt out of the rule against perpetuities.  The second 
trust may opt out of the rule against perpetuities if the first trust could have done so. 
If the first trust and the state law applicable to the first trust permitted the springing of the 
“Delaware Tax Trap” of Code Section 2041(a)(3), the second trust may also permit the springing 
of the Delaware Tax Trap. 
The second trust may terminate earlier than the trust duration rule applicable to the first 
trust would require.  Assume Trust A and Trust B are both subject to State Z’s trust duration rule, 
which is a traditional rule against perpetuities.  Both trusts were created by the same settlor and 
contain a perpetuities savings clause that requires the termination of the trust twenty-one years 
after the death of the survivor of the settlor’s descendants living on the date the trust was created.  
Trust A was created on June 6, 1966.  Trust B was created May 5, 1955.  Trust A may be 
decanted into Trust B because Trust B will terminate prior to the rule against perpetuities 
applicable to Trust A.  Trust B may be decanted into Trust A if Trust A is modified to provide, or 
the decanting instrument provides, that the portion of Trust A attributable to the addition of the   71 
assets of Trust B must vest within the rule against perpetuities period applicable to Trust B.  The 
trustee could segregate the assets Trust A receives from the decanting of Trust B.  Alternatively, 
the trustee could determine the fractional share of the total assets attributable to Trust B, based 
upon values at the time of decanting, and such fractional share of Trust A will be subject to the 
rule against perpetuities period applicable to Trust B. 
If the authorized fiduciary attempts to decant Trust B into Trust A without providing 
either in Trust A or the decanting instrument that the portion of the trust attributable to Trust B 
must vest within the rule against perpetuities period applicable to Trust B, the decanting may still 
be valid.  First, the statutes of State Z may contain a rule against perpetuities savings clause that 
will cause the trust to vest or terminate within the applicable rule against perpetuities period.  
Second, if there is no statutory savings clause, Section 22 of this act may apply to read into Trust 
A an appropriate savings clause with respect to the portion of the trust attributable to Trust B. 
Section 20 does not address whether, if the decanting changes the place of administration 
for the trust or the law governing the trust, and the new jurisdiction has a more restrictive trust 
duration rule, the new jurisdiction may impose its maximum perpetuity, accumulation or 
suspension-of-the-power-of-alienation period on the second trust.  The new jurisdiction may do 
so if the rule of the first jurisdiction is contrary to a strong public policy of the new jurisdiction.  
Thus if the first jurisdiction has no rule against perpetuities, and the second jurisdiction has a 
traditional rule against perpetuities, the second jurisdiction may but need not determine that its 
rule expresses a strong public policy against perpetual trusts. 
Subsection (a) provides that, except as provided by subsection (b), the second trust may 
have a term that is the same as or different from the term of the first trust.  Thus the term of the 
second trust may be longer than or shorter than the term of the first trust. 
SECTION 21.  NEED TO DISTRIBUTE NOT REQUIRED.  An authorized fiduciary 
may exercise the decanting power whether or not under the first trust’s discretionary distribution 
standard the fiduciary would have made or could have been compelled to make a discretionary 
distribution of principal at the time of the exercise. 
Comment 
Although the decanting power under Sections 11 and 12 is premised on the authorized 
fiduciary’s power to distribute principal of the first trust to one or more current beneficiaries, the 
authorized fiduciary may exercise the decanting power even if the authorized fiduciary would 
not have made a distribution of principal to a current beneficiary under the distribution standard 
of the first trust.  For example, assume a trust permits the trustee to distribute income and 
principal to S for S’s support and health care, considering S’s other resources, and that given S’s 
other resources the trustee would not currently make a distribution to S.  The trustee may still 
exercise the decanting power under Section 12. 
Section 21, however, does not authorize an exercise of the decanting power under   72 
Sections 11 and 12 if the authorized fiduciary does not currently have a power to distribute 
principal.  For example, if a trust permits income to be distributed to A, but does not permit 
principal distributions until A is age 25 or has a child, and A is age 21 and has no child, the 
trustee may not decant the trust under Section 11 or Section 12. 
 SECTION 22.  SAVING PROVISION. 
(a) If exercise of the decanting power would be effective under this [act] except that the 
second-trust instrument in part does not comply with this [act], the exercise of the power is 
effective and the following rules apply with respect to the principal of the second trust 
attributable to the exercise of the power: 
 (1) A provision in the second-trust instrument which is not permitted under this 
[act] is void to the extent necessary to comply with this [act]. 
 (2) A provision required by this [act] to be in the second-trust instrument which is 
not contained in the instrument is deemed to be included in the instrument to the extent necessary 
to comply with this [act]. 
(b) If a trustee or other fiduciary of a second trust determines that subsection (a) applies 
to a prior exercise of the decanting power, the fiduciary shall take corrective action consistent 
with the fiduciary’s duties. 
Comment 
In order to provide as much certainty as possible to the trustee and the beneficiaries with 
respect to the operative terms of a trust, an exercise of a decanting power should not be wholly 
invalid because the second-trust instrument in part violates this act.  Section 22(a) modifies the 
second-trust instrument to delete impermissible provisions in the second-trust instrument and to 
insert required provisions in the second-trust instrument.  For example, if the second trust sets 
forth an impermissible rule against perpetuities period (see Section 20), the other modifications 
made by the decanting should be effective. 
The remedial rules of Section 22 apply only to the least extent required to comply with 
this act.  Thus if a provision in the second-trust instrument would be permissible with respect to 
some of the trust property but is impermissible with respect to other trust property, such 
provision will be void only as to the trust property with respect to which it is impermissible.  
Further, any modification to a provision of the second-trust instrument that is required by Section 
22 should be the modification that implements the intended modifications to the greatest extent   73 
permitted under the act.  Thus the authorized fiduciary’s intent is relevant in determining how to 
apply the provisions of Section 22. 
For example, assume a trust holds $500,000 of marketable assets and is the beneficiary of 
Grantor’s $100,000 IRA.  Grantor’s Child is the sole current beneficiary of the trust.  The trust is 
qualified to use Child’s life expectancy in determining the distribution period for the IRA 
because the trust restricts all future beneficiaries, including appointees under any power of 
appointment and takers in default, to individuals younger than Child.  The authorized fiduciary 
attempts to decant the trust to permit Child to appoint to her spouse.  This is in violation of 
Section 19(b)(6) because if Child could appoint the IRA to a spouse who is older than Child, 
Trust would not have qualified to take IRA distributions over Child’s life expectancy.  Section 
19(b)(6) causes the qualified benefit property and any reinvested distributions of the qualified 
benefit property to be treated as a separate share.  Section 22 will void the power to appoint to a 
spouse only with respect to the qualified benefit property and any reinvested distributions of the 
qualified benefit property, and only if the spouse is (or could be) older than Child, because that is 
the least intrusive remediation required to comply with Section 19(b)(6). 
As another example, assume the authorized fiduciary attempts to decant a trust to permit 
Child to appoint to her sibling.  If Child’s sibling is older than Child, this is in violation of 
Section 19(b)(6) because if Child could appoint the IRA to her older sibling, the trust would not 
have qualified to take IRA distributions over Child’s life expectancy.  Section 19(b)(6) causes 
the qualified benefit property and any reinvested distributions of the qualified benefit property to 
be treated as a separate share.  Section 22 will void the power to appoint to a sibling only with 
respect to the qualified benefit property and any reinvested distributions of the qualified benefit 
property, which are treated as a separate share, and only if the sibling is older than Child, 
because that is the least intrusive remediation required to comply with Section 19(b)(6). 
As yet another example, assume the authorized fiduciary attempts to decant Trust to 
change (1) the successor fiduciaries, (2) the manner in which the first trust instrument directed 
that the authorized fiduciary be compensated, which will increase the authorized fiduciary’s 
compensation, and (3) the identity of the person who can remove the authorized fiduciary (the 
“Remover”).  The authorized fiduciary obtains the written consent of the qualified beneficiaries 
of the second trust, but does not obtain consent of the Remover or approval by the court.  The 
changes to the successor fiduciaries will be effective.  The change to the authorized fiduciary’s 
compensation will also be effective because the requirement in Section 16(a) or Section 16(b) 
was met.  The change to the identity of the Remover will not be effective because the Remover 
named in the first trust instrument did not consent.  See Section 18. 
Section 22(b) provides that if the savings provision in Section 22(a) applies, the trustee or 
other fiduciary shall take corrective action consistent with the fiduciary’s duties.  When Section 
22(a) applies, the copy of the second-trust instrument provided to qualified beneficiaries and 
other parties under Section 7 would not accurately state the terms of the second trust.  A trustee 
or other fiduciary may have a duty to notify certain persons of the accurate terms of the second 
trust.  See, for example, Section 813(a) of the Uniform Trust Code imposing a duty on the trustee 
to keep the qualified beneficiaries reasonably informed about the administration of the trust and 
the material facts necessary for them to protect their interests.   74 
Additional corrective action may be required, especially if distributions were made or not 
made in reliance on the assumed terms of the second-trust instrument and such terms are altered 
by Section 22(a). 
Where a fiduciary is uncertain about whether corrective action should be taken, the 
fiduciary may apply to the court for instructions under Section 9. 
 SECTION 23.  TRUST FOR CARE OF ANIMAL. 
(a) In this section: 
 (1) “Animal trust” means a trust or an interest in a trust created to provide for the 
care of one or more animals. 
 (2) “Protector” means a person appointed in an animal trust to enforce the trust on 
behalf of the animal or, if no such person is appointed in the trust, a person appointed by the 
court for that purpose. 
(b) The decanting power may be exercised over an animal trust that has a protector to the 
extent the trust could be decanted under this [act] if each animal that benefits from the trust were 
an individual, if the protector consents in a signed record to the exercise of the power. 
(c) A protector for an animal has the rights under this [act] of a qualified beneficiary. 
(d) Notwithstanding any other provision of this [act], if a first trust is an animal trust, in 
an exercise of the decanting power, the second trust must provide that trust property may be 
applied only to its intended purpose for the period the first trust benefitted the animal. 
Comment 
Section 408 of the Uniform Trust Code permits a trust to be created for one or more 
animals who are alive during the settlor’s lifetime.  “Animal” is not defined in the Uniform Trust 
Code and thus is not defined in this act.  It should be construed in its common usage as referring 
to a multicell living organism that feeds on organic matter, and that typically is motile at some 
point in its life and has sensory organs.  It thus includes, for example, mammals, birds, reptiles, 
fish and insects.  In this section, the term “animal” should be construed to mean nonhuman 
animals.  The term includes, without limitation, pets and domesticated animals. 
The Uniform Trust Code provides that an animal trust may be enforced by a person 
appointed in the terms of the trust or, if no such person is appointed, by a person appointed by   75 
the court.  Subsection (a)(2) incorporates that concept in the definition of “protector.” 
One impediment to applying decanting to an animal trust is that animal trusts often do not 
technically have a beneficiary because the definition of “beneficiary” is restricted to a person 
who has a particular interest in the trust.  The definition of the term “person” does not include a 
nonhuman animal.  This impediment is resolved by treating the animal as if it were a person so 
that the animal trust does have a beneficiary for purposes of the decanting power.  The extent of 
the decanting power would then depend upon the amount of discretion that the authorized 
fiduciary has to make distributions for the animal and to any other person.  If the trustee has 
expanded discretion, then the decanting power could be exercised under Section 11.  If the 
trustee only has limited discretion to make distributions to the animal, then the decanting power 
can be exercised under Section 12. 
The second impediment to exercising a decanting power over an animal trust is 
identifying a person who can receive notice of the decanting on behalf of the animal and bring a 
court action with respect to the decanting if appropriate.  This impediment is resolved because an 
animal trust will usually have a person who is designated to enforce the trust on behalf of the 
animal.  Section 408(b) of the Uniform Trust Code provides that such a trust may be enforced by 
a person appointed in the terms of the trust or, if no person is so appointed, by a person 
appointed by the court.  Thus if an animal trust did not designate a person to enforce the trust on 
behalf of the animal, the trustee could request that the court appoint such a person and then 
proceed with any exercise of the decanting power. 
Section 408 of the Uniform Trust Code provides that the property of an animal trust may 
be applied only to its intended use, except to the extent the court determines that the value of the 
trust property exceeds the amount required for the intended use.  Although Section 23 permits 
the decanting of an animal trust, it mirrors the requirement of the Uniform Trust Code that the 
property of the animal trust may be applied only to its intended use for the period of time the first 
trust was intended to benefit the animals (usually the lives of the animals).  Therefore, the 
authorized fiduciary cannot, by decanting, reduce the value of the animal trust; such a power is 
reserved only to the court.  Further, the authorized fiduciary cannot divert assets of the animal 
trust to other beneficiaries of the trust. 
Assume that Trust was established for the support of Double Trouble, a husky, after the 
death of Double Trouble’s human companion.  Trust directs that the Trust shall continue to 
maintain Double Trouble in her Alaskan house, which is owned by the Trust, under the care of 
Joan, a retired musher, and permits distributions of income and principal to maintain the house 
and for Double Trouble’s best interests so long as Double Trouble is living.  Upon the death of 
Double Trouble, Trust is distributed to the Husky Rescue Society, a charitable organization.  
Double Trouble is aging and the veterinarian advises a move to a warmer climate.  The assets of 
the Trust are diminishing, and may not be sufficient to maintain the Alaskan house and pay for 
Double Trouble’s care.  Joan is aging too, and would prefer to care for Double Trouble in Joan’s 
house in Hawaii.  The authorized trustee may, with the consent of the protector, modify Trust to 
permit the sale of the Alaskan house and to permit Joan to care for Double Trouble in her Hawaii 
home.  Notice of the decanting must be provided to the protector, the Husky Rescue Society and 
to the Attorney General (or other official with enforcement authority over charitable interests).  
The second trust, however, may not add Joan as a beneficiary because such a modification would   76 
not be permitted under Section 11.  Nor may the decanting provide that one year after the move 
to Hawaii, one-half of the principal will be distributed to the Husky Rescue Society, because 
Section 23(d) requires that the trust property be applied only for its intended purpose (the care of 
Double Trouble) for the period the first trust benefitted the animal (the life of Double Trouble). 
SECTION 24.  TERMS OF SECOND TRUST.  A reference in [this state’s trust code] 
to a trust instrument or terms of the trust includes a second-trust instrument and the terms of the 
second trust. 
Legislative Note: Conforming amendments may be required to this state’s trust code. 
 SECTION 25.  SETTLOR. 
(a) For purposes of law of this state other than this [act] and subject to subsection (b), a 
settlor of a first trust is deemed to be the settlor of the second trust with respect to the portion of 
the principal of the first trust subject to the exercise of the decanting power. 
(b) In determining settlor intent with respect to a second trust, the intent of a settlor of the 
first trust, a settlor of the second trust, and the authorized fiduciary may be considered. 
Legislative Note: Conforming amendments may be required to this state’s trust code. 
Comment 
“Settlor” is defined in Section 2(25) as the person who creates or contributes property of 
the trust, except as provided in Section 25.  The comments to Section 102 and Section 103 of the 
Uniform Trust Code generally consider the person who funded a trust as the settlor and would 
not treat as the settlor a nominal grantor, meaning a person who signs the trust instrument to 
create the trust but who does not contribute the property to the trust (except perhaps for nominal 
funding). 
When a new trust instrument is created for purposes of serving as the second trust for a 
decanting, the second-trust instrument may be signed by the trustee of the first trust, a 
beneficiary, the settlor of the first trust, an attorney for the settlor, the trustee or a beneficiary of 
the first trust, or some other person.  Under these circumstances, the creator of the second trust 
generally will not be the settlor of the second trust unless such person funded the first trust or is 
the authorized fiduciary exercising the decanting power. 
For most purposes, when a trust is decanted the settlor of the first trust should be 
considered the settlor of the second trust to the extent of the decanting.  If the second trust is a 
pre-existing trust funded by a different settlor, then the original settlor of the second trust would 
continue to be considered the settlor over the portion of the trust property attributable to that   77 
person’s contribution and the original settlor of the first trust would be considered the settlor of 
the portion of the second trust property attributable to the decanting.  This general rule of Section 
25(a) would apply, for example, for purposes of determining who holds the rights granted to the 
settlor or who must consent when the settlor’s consent is required for an action and for tax 
purposes.  For example, under the Uniform Trust Code this rule would apply for purposes of 
Section 113 (Insurable Interest), Section 301(d) (limiting the ability of a settlor to represent a 
beneficiary), Section 405(a) (enforcement of a charitable trust), Section 411 (modification of a 
trust with the settlor’s intent), Section 505 (Creditor’s Claims), Section 706(a) (request to 
remove a trustee), and Section 814 (limiting certain discretionary powers). 
For purposes of determining the settlor’s intent or purpose in creating a trust, or whether 
the settlor did not anticipate certain circumstances, it may sometimes be appropriate to consider 
the intent of the original settlor of the second trust.  For example, if a decanting distribution is 
made to a pre-existing trust with property of its own, the intent of the original settlor of the 
second trust may be more relevant in construing, modifying or reforming the second-trust 
instrument after the decanting distribution.  In such a case, the decanting distribution adopts the 
language of the second-trust instrument, which is most appropriately construed with respect to 
the intent of the creator of such trust.  When a decanting distribution is made to a second trust 
created by the authorized fiduciary for the purposes of decanting, or when the decanting is a 
modification of the first trust, the intent of the authorized fiduciary may be most relevant in later 
construing the terms of the second trust, or at least the terms modified by the decanting.  The 
intent of the settlor of the first trust may still be relevant, however, because the decanting would 
have been made to better carry out the purposes of the first trust.  Further, to the extent the 
second trust does not modify the terms of the first trust, the intent of the settlor of the first trust 
would be relevant in construing such terms. 
Section 25(b) would apply, under the Uniform Trust Code, with respect to Section 412 
(Modification or Termination Because of Unanticipated Circumstances), Section 415 
(Reformation to Correct Mistakes) and Section 416 (Modification to Achieve Settlor’s Tax 
Objectives).  For example, under Section 412 of the Uniform Trust Code, a court may make 
certain trust modifications if because of “circumstances not anticipated by the settlor, 
modification or termination will further the purposes of the trust.”  The modification, to the 
extent practicable, is to be made in “accordance with the settlor’s probable intention.”  Thus 
where the authorized fiduciary of the first trust, or some other person, has created the second 
trust, the intent of the maker of the second trust may be relevant in determining, with respect to 
the second trust, what circumstances were not anticipated by the settlor and what would be the 
settlor’s probable intent. 
Section 25(b) may also apply in other contexts for determining the purposes and material 
purposes of the trust.  The material purposes of the trust may, for example, be relevant in 
determining whether a nonjudicial settlement agreement is valid.  Settlor intent is relevant in 
determining a trust’s purposes and material purposes. 
SECTION 26.  LATER-DISCOVERED PROPERTY. 
 (a) Except as otherwise provided in subsection (c), if exercise of the decanting power was   78 
intended to distribute all the principal of the first trust to one or more second trusts, later-
discovered property belonging to the first trust and property paid to or acquired by the first trust 
after the exercise of the power is part of the trust estate of the second trust or trusts. 
 (b) Except as otherwise provided in subsection (c), if exercise of the decanting power was 
intended to distribute less than all the principal of the first trust to one or more second trusts, 
later-discovered property belonging to the first trust or property paid to or acquired by the first 
trust after exercise of the power remains part of the trust estate of the first trust. 
 (c) An authorized fiduciary may provide in an exercise of the decanting power or by the 
terms of a second trust for disposition of later-discovered property belonging to the first trust or 
property paid to or acquired by the first trust after exercise of the power. 
Comment 
If the decanting power is exercised by modifying the terms of the first trust, the trustee 
could either treat the second trust created by such modification as a new trust, in which case the 
property of the first trust would need to be transferred to the second trust, or alternatively treat 
the second trust as a continuation of the first trust, in which case the property of the first trust 
would not need to be retitled.  When the second trust is a continuation of the first trust, any 
property owned by the first trust is still owned by the trust after the decanting, even if the 
authorized fiduciary is not aware of such property at the time of the decanting. 
When the decanting power is exercised by distributing property of the first trust to a 
separate second trust, regardless of whether the terms of such second trust are set forth in an 
entirely separate trust instrument or a modification of the first-trust instrument, the property of 
the first trust needs to be transferred to the second trust(s).  Inevitably, there will be cases where 
the trustee fails to transfer all of the property to the second trust.  The trustee can protect against 
this possibility by, in the exercise of the decanting power, making a global assignment of all trust 
property to the second trust.  When the property of the first trust is being divided among more 
than one second trusts or not all of the property of the first trust is being decanted, it is more 
complicated, but still possible, to specify in the exercise of the decanting power how later-
discovered property should be allocated. 
Section 26(c) explicitly permits an authorized fiduciary to provide, in an exercise of the 
decanting power or by the terms of a second trust, for disposition of later-discovered property 
belonging to the first trust or property paid to or acquired by the first trust after exercise of the 
decanting power.  For example, if an authorized fiduciary exercises the decanting power over a 
trust to create a special-needs trust for the settlor’s child J and to create a separate trust for the 
settlor’s other children, the exercise of the decanting power might state that the trust for J will be   79 
funded with marketable securities and cash with a value of $1,000,000 and that all other 
property, including later-discovered property, will be distributed to and owned by the trust for 
the other children.  Assume the trust for J is then funded with $1,000,000 of marketable 
securities and all other property then known to the trustee is assigned to the trust for the other 
children.  If subsequently other trust assets are discovered, it would be clear that they belong to 
the trust for the other children and not the trust for J. 
The trustee in transferring title to the first trust’s property pursuant to a decanting may 
also take the precaution of executing a global assignment of all property not otherwise expressly 
transferred to the appropriate second trusts. 
Section 26(a) and (b) specify default rules when later-discovered property and property 
paid to or acquired by the first trust after the exercise of the decanting power is not expressly 
allocated to a particular trust by the exercise, by the second-trust instrument or by an assignment. 
Subsection (a) provides that if the decanting intended to distribute all of the principal of 
the first trust to one or more second trusts, then the property is part of the second trust or trusts.  
When there is more than one second trusts, the exercise of the decanting power might specify 
their respective interests in the property of the first trust or if it does not, the second trusts may 
need to reach agreement about their respective ownership interests. 
Subsection (b) provides that if the decanting was not intended to distribute all of the 
principal of the first trust to one or more second trusts, such property remains part of the first 
trust. 
SECTION 27.  OBLIGATIONS. A debt, liability, or other obligation enforceable 
against property of a first trust is enforceable to the same extent against the property when held 
by the second trust after exercise of the decanting power. 
Comment 
It would be inequitable to permit a second trust to evade liabilities incurred by the trustee 
of the first trust to the extent the creditor would have been entitled to satisfaction out of the trust 
property.  Section 27 provides that a debt, liability or other obligation of the first trust against 
property of a first trust is enforceable to the same extent against such property when held by the 
second trust.  Section 27 may apply to contractual claims, obligations arising from ownership or 
control of trust property and to torts committed in the course of administering a trust.  Cf. 
Uniform Trust Code § 1010(c). 
The Restatement Second of Trusts provides various situations in which a person to whom 
the trustee has incurred a liability in the course of the administration of a trust can by a 
proceeding in equity reach trust property and apply it to the satisfaction of such person’s claim.  
See Restatement Second of Trusts § 267.  Section 268 of the Restatement Second of Trusts 
provides that the creditor can reach trust property to the extent the creditor cannot obtain 
satisfaction of the claim out of the trustee’s individual property to the extent the trustee is entitled   80 
to exoneration out of the trust estate.  Section 269 of the Restatement Second of Trusts provides 
that a creditor who cannot obtain satisfaction out of the trustee’s individual property can by a 
proceeding in equity reach trust property to the extent the trust estate has benefitted.  Section 270 
of the Restatement Second of Trusts permits the creditor to reach trust property if by the terms of 
the trust the settlor manifested an intention to confer such a power on the creditor.  Section 271 
of the Restatement Second of Trusts permits a creditor to reach trust property on a contractual 
claim if the contract provides that the trustee shall not be personally liable upon the contract and 
the contract was properly made by the trustee in the administration of the trust.  Section 271A of 
the Restatement Second of Trusts permits a creditor to obtain satisfaction out of the trust estate if 
it is equitable to permit him to do so. 
For example, assume Chicago Bank makes a loan to the trustee of First Trust, secured by 
First Trust’s holdings of Fuchsia Corp. stock.  The loan provides that trustee is not personally 
liable.  The trustee decants First Trust and distributes all of its assets to Second Trust.  Chicago 
Bank may enforce the loan against the property of Second Trust, including the Fuchsia Corp. 
stock, to the same extent it could have enforced the loan against the property of First Trust.  If 
Second Trust also owns property not attributed to the decanting, Section 27 does not expose such 
property to Chicago Bank’s claim. 
Assume instead that the trustee of First Trust decanted and distributed all of the Fuchsia 
Corp. stock to Second Trust, and distributed all of the other assets of First Trust to Third Trust.  
Chicago Bank may enforce the loan against the Fuchsia Corp. stock held by Second Trust to the 
same extent it could have enforced the loan against the Fuchsia Corp. stock when it was held by 
First Trust.  If prior to the decanting Chicago Bank could have enforced the loan against the 
property of First Trust other than the Fuchsia Corp. stock to the extent the value of the Fuchsia 
Corp. stock was insufficient to satisfy the loan, after the decanting Chicago Bank may enforce 
the loan, to the extent the Fuchsia Corp. stock is insufficient to satisfy the loan, against the other 
property of Second Trust and Third Trust to the extent it was attributable to the property of First 
Trust. 
Section 27 only applies to a debt, liability or other obligation that is in existence and 
enforceable against the property of the first trust at the time of the decanting. 
Section 27 is not intended to impede an authorized fiduciary from exercising the 
decanting power in a manner that may protect the property of the second trust from debts, 
liabilities or obligations of the settlor or a beneficiary to a greater extent than the property of the 
first trust would have been protected from such debts, liabilities or obligations.  For example, a 
decanting may add a spendthrift provision to a trust.  As another example, a decanting under 
Section 11 could postpone or eliminate a prospective withdrawal right of a beneficiary or 
eliminate a general power of appointment that is not presently exercisable. 
SECTION 28.  UNIFORMITY OF APPLICATION AND CONSTRUCTION.  In 
applying and construing this uniform act, consideration must be given to the need to promote 
uniformity of the law with respect to its subject matter among states that enact it.   81 
SECTION 29.  RELATION TO ELECTRONIC SIGNATURES IN GLOBAL AND 
NATIONAL COMMERCE ACT.  This [act] modifies, limits, or supersedes the Electronic 
Signatures in Global and National Commerce Act, 15 U.S.C. Section 7001 et seq., but does not 
modify, limit, or supersede Section 101(c) of that act, 15 U.S.C. Section 7001(c), or authorize 
electronic delivery of any of the notices described in Section 103(b) of that act, 15 U.S.C. 
Section 7003(b). 
 [SECTION 30.  SEVERABILITY. If any provision of this [act] or its application to 
any person or circumstance is held invalid, the invalidity does not affect other provisions or 
applications of this [act] which can be given effect without the invalid provision or application, 
and to this end the provisions of this [act] are severable.] 
Legislative Note: Include this section only if this state lacks a general severability statute or a 
decision by the highest court of this state stating a general rule of severability. 
 SECTION 31.  REPEALS; CONFORMING AMENDMENTS. 
 (a) . . . . 
 (b) . . . .  
 (c) . . . . 
 SECTION 32.  EFFECTIVE DATE.  This [act] takes effect . . . .   2 
 
“19-1904.  Fiduciary duty. 37 
“19-1905.  Application; governing law. 38 
“19-1906.  Reasonable reliance. 39 
“19-1907.  Notice; exercise of decanting power. 40 
“19-1908.  Representation. 41 
“19-1909.  Court involvement. 42 
“19-1910.  Formalities. 43 
“19-1911.  Decanting power under expanded distributive discretion. 44 
“19-1912.  Decanting power under limited distributive discretion. 45 
“19-1913.  Trust for beneficiary with disability. 46 
“19-1914.  Protection of charitable interest. 47 
“19-1915.  Trust limitation on decanting. 48 
“19-1916.  Change in compensation. 49 
“19-1917.  Relief from liability and indemnification. 50 
“19-1918.  Removal or replacement of authorized fiduciary. 51 
“19-1919.  Tax-related limitations. 52 
“19-1920.  Duration of second trust. 53 
“19-1921.  Need to distribute not required. 54 
“19-1922.  Saving provision. 55 
“19-1923.  Trust for care of animal. 56 
“19-1924.  Terms of second trust. 57 
“19-1925.  Settlor. 58 
“19-1926.  Later-discovered property. 59   3 
 
“19-1927.  Obligations. 60 
“19-1928.  Uniformity of application and construction. 61 
“19-1929.  Relation to Electronic Signatures in Global and National Commerce Act. 62 
 “Chapter 19.  Uniform Trust Decanting Act 63 
 Ҥ 19-1901.  Short title. 64 
 “This chapter may be cited as the Uniform Trust Decanting Act. 65 
 Ҥ 19-1902.  Definitions. 66 
 “In this chapter: 67 
 “(1) “Appointive property” means the property or property interest subject to a power of 68 
appointment. 69 
 “(2) “Ascertainable standard” means a standard relating to an individual’s health, 70 
education, support, or maintenance within the meaning of 26 U.S.C. § 2041(b)(1)(A) or 26 71 
U.S.C. § 2514(c)(1) and any applicable regulations. 72 
 “(3) “Attorney General” means the Attorney General for the District of Columbia. 73 
 “(4) “Authorized fiduciary” means: 74 
 “(A) A trustee or other fiduciary, other than a settlor, that has discretion to 75 
distribute or direct a trustee to distribute part or all of the principal of the first trust to one or 76 
more current beneficiaries; 77 
 “(B) A special fiduciary appointed under § 19-1909; or 78 
 “(C) A special-needs fiduciary under § 19-1913. 79 
 “(5) “Beneficiary” means a person that: 80 
 “(A) Has a present or future, vested or contingent, beneficial interest in a trust; 81 
 “(B) Holds a power of appointment over trust property; or 82   4 
 
 “(C) Is an identified charitable organization that will or may receive distributions 83 
under the terms of the trust. 84 
 “(6) “Charitable interest” means an interest in a trust which: 85 
 “(A) Is held by an identified charitable organization and makes the organization a 86 
qualified beneficiary; 87 
 “(B) Benefits only charitable organizations and, if the interest were held by an 88 
identified charitable organization, would make the organization a qualified beneficiary; or 89 
 “(C) Is held solely for charitable purposes and, if the interest were held by an 90 
identified charitable organization, would make the organization a qualified beneficiary. 91 
 “(7) “Charitable organization” means:  92 
 “(A) A person, other than an individual, organized and operated exclusively for 93 
charitable purposes; or 94 
 “(B) A government or governmental subdivision, agency, or instrumentality, to 95 
the extent it holds funds exclusively for a charitable purpose. 96 
 “(8) “Charitable purpose” means the relief of poverty, the advancement of education or 97 
religion, the promotion of health, a municipal or other governmental purpose, or another purpose 98 
the achievement of which is beneficial to the community. 99 
 “(9) “Court” means the Superior Court of the District of Columbia. 100 
 “(10) “Current beneficiary” means a beneficiary that on the date the beneficiary’s 101 
qualification is determined is a distributee or permissible distributee of trust income or principal.  102 
The term includes the holder of a presently exercisable general power of appointment but does 103 
not include a person that is a beneficiary only because the person holds any other power of 104 
appointment. 105   5 
 
 “(11) “Decanting power” or “the decanting power” means the power of an authorized 106 
fiduciary under this chapter to distribute property of a first trust to one or more second trusts or 107 
to modify the terms of the first trust. 108 
 “(12) “District” means the District of Columbia. 109 
 “(13) “Expanded distributive discretion” means a discretionary power of distribution that 110 
is not limited to an ascertainable standard or a reasonably definite standard. 111 
 “(14) “First trust” means a trust over which an authorized fiduciary may exercise the 112 
decanting power. 113 
 “(15) “First-trust instrument” means the trust instrument for a first trust. 114 
 “(16) “General power of appointment” means a power of appointment exercisable in 115 
favor of a powerholder, the powerholder’s estate, a creditor of the powerholder, or a creditor of 116 
the powerholder’s estate. 117 
 “(17) “Jurisdiction”, with respect to a geographic area, includes a state or country. 118 
 “(18) “Person” means an individual, estate, business or nonprofit entity, public 119 
corporation, government or governmental subdivision, agency, or instrumentality, or other legal 120 
entity. 121 
 “(19) “Power of appointment” means a power that enables a powerholder acting in a 122 
nonfiduciary capacity to designate a recipient of an ownership interest in or another power of 123 
appointment over the appointive property.  The term does not include a power of attorney. 124 
 “(20) “Powerholder” means a person in which a donor creates a power of appointment. 125 
 “(21) “Presently exercisable power of appointment” means a power of appointment 126 
exercisable by the powerholder at the relevant time. 127   6 
 
 “(A) The term includes a power of appointment exercisable only after the 128 
occurrence of a specified event, the satisfaction of an ascertainable standard, or the passage of a 129 
specified time only after: 130 
 “(i) The occurrence of the specified event; 131 
 “(ii) The satisfaction of the ascertainable standard; or 132 
 “(iii) The passage of the specified time. 133 
 “(B) The term does not include a power exercisable only at the powerholder’s 134 
death. 135 
 “(22) “Qualified beneficiary” means a beneficiary that on the date the beneficiary’s 136 
qualification is determined: 137 
 “(A) Is a distributee or permissible distributee of trust income or principal; 138 
 “(B) Would be a distributee or permissible distributee of trust income or principal 139 
if the interests of the distributees described in subparagraph (A) terminated on that date without 140 
causing the trust to terminate; or 141 
 “(C) Would be a distributee or permissible distributee of trust income or principal 142 
if the trust terminated on that date. 143 
 “(23) “Reasonably definite standard” means a clearly measurable standard under which a 144 
holder of a power of distribution is legally accountable within the meaning of 26 U.S.C. § 145 
674(b)(5)(A) and any applicable regulations. 146 
 “(24) “Record” means information that is inscribed on a tangible medium or that is stored 147 
in an electronic or other medium and is retrievable in perceivable form. 148 
 “(25) “Second trust” means: 149 
 “(A) A first trust after modification under this chapter; or  150   7 
 
 “(B) A trust to which a distribution of property from a first trust is or may be 151 
made under this chapter. 152 
 “(26) “Second-trust instrument” means the trust instrument for a second trust. 153 
 “(27) “Settlor”, except as otherwise provided in § 19-1925, means a person, including a 154 
testator, that creates or contributes property to a trust. If more than one person creates or 155 
contributes property to a trust, each person is a settlor of the portion of the trust property 156 
attributable to the person’s contribution except to the extent another person has power to revoke 157 
or withdraw that portion. 158 
 “(28) “Sign” means, with present intent to authenticate or adopt a record: 159 
 “(A) To execute or adopt a tangible symbol; or 160 
 “(B) To attach to or logically associate with the record an electronic symbol, 161 
sound, or process. 162 
 “(29) “State” means a state of the United States, the District, Puerto Rico, the United 163 
States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the 164 
United States. 165 
 “(30) “Terms of a trust” means: 166 
 “(A) Except as otherwise provided in subparagraph (B), the manifestation of the 167 
settlor’s intent regarding a trust’s provisions as: 168 
 “(i) Expressed in the trust instrument; or 169 
 “(ii) Established by other evidence that would be admissible in a judicial 170 
proceeding; or 171 
 “(B) The trust’s provisions as established, determined, or amended by: 172 
 “(i) A trustee or trust director in accordance with applicable law; 173   8 
 
 “(ii) Court order; or 174 
 “(iii) A nonjudicial settlement agreement under § 19-1301.11.  175 
 “(31) “Trust instrument” means a record executed by the settlor to create a trust or by any 176 
person to create a second trust which contains some or all of the terms of the trust, including any 177 
amendments. 178 
 Ҥ 19-1903.  Scope. 179 
 “(a) Except as otherwise provided in subsections (b) and (c) of this section, this chapter 180 
applies to an express trust that is irrevocable or revocable by the settlor only with the consent of 181 
the trustee or a person holding an adverse interest. 182 
 “(b) This chapter does not apply to a trust held solely for charitable purposes. 183 
 “(c) Subject to § 19-1915, a trust instrument may restrict or prohibit exercise of the 184 
decanting power. 185 
 “(d) This chapter does not limit the power of a trustee, powerholder, or other person to 186 
distribute or appoint property in further trust or to modify a trust under the trust instrument, law 187 
of the District other than this chapter, common law, a court order, or a nonjudicial settlement 188 
agreement. 189 
 “(e) This chapter does not affect the ability of a settlor to provide in a trust instrument for 190 
the distribution of the trust property or appointment in further trust of the trust property or for 191 
modification of the trust instrument. 192 
 Ҥ 19-1904.  Fiduciary duty. 193 
 “(a) In exercising the decanting power, an authorized fiduciary shall act in accordance 194 
with its fiduciary duties, including the duty to act in accordance with the purposes of the first 195 
trust. 196   9 
 
 “(b) This chapter does not create or imply a duty to exercise the decanting power or to 197 
inform beneficiaries about the applicability of this chapter. 198 
 “(c) Except as otherwise provided in a first-trust instrument, for purposes of this chapter 199 
and §§ 19-1308.01 and 19-1308.02(a), the terms of the first trust are deemed to include the 200 
decanting power. 201 
 Ҥ 19-1905.  Application; governing law. 202 
 “This chapter applies to a trust created before, on, or after the effective date of this 203 
chapter which: 204 
 “(1) Has its principal place of administration in the District, including a trust whose 205 
principal place of administration has been changed to the District; or 206 
 “(2) Provides by its trust instrument that it is governed by the law of the District or is 207 
governed by the law of the District for the purpose of: 208 
 “(A) Administration, including administration of a trust whose governing law for 209 
purposes of administration has been changed to the law of the District; 210 
 “(B) Construction of terms of the trust; or 211 
 “(C) Determining the meaning or effect of terms of the trust. 212 
 Ҥ 19-1906.  Reasonable reliance. 213 
 “A trustee or other person that reasonably relies on the validity of a distribution of part or 214 
all of the property of a trust to another trust, or a modification of a trust, under this chapter, law 215 
of the District other than this chapter, or the law of another jurisdiction is not liable to any person 216 
for any action or failure to act as a result of the reliance. 217 
 § 19-1907. Notice; exercise of decanting power. 218   10 
 
 “(a) In this section, a notice period begins on the day notice is given under subsection (c) 219 
of this section and ends 59 days after the day notice is given. 220 
 “(b) Except as otherwise provided in this chapter, an authorized fiduciary may exercise 221 
the decanting power without the consent of any person and without court approval. 222 
 “(c) Except as otherwise provided in subsection (f) of this section, an authorized fiduciary 223 
shall give notice in a record of the intended exercise of the decanting power not later than 60 224 
days before the exercise to: 225 
 “(1) Each settlor of the first trust, if living or then in existence; 226 
 “(2) Each qualified beneficiary of the first trust; 227 
 “(3) Each holder of a presently exercisable power of appointment over any part or 228 
all of the first trust; 229 
 “(4) Each person that currently has the right to remove or replace the authorized 230 
fiduciary; 231 
 “(5) Each other fiduciary of the first trust;  232 
 “(6) Each fiduciary of the second trust; and 233 
 “(7) The Attorney General, if § 19-1914(b) applies. 234 
 “(d) An authorized fiduciary is not required to give notice under subsection (c) to a 235 
qualified beneficiary who is a minor and has no representative or to a person that is not known to 236 
the fiduciary or is known to the fiduciary but cannot be located by the fiduciary after reasonable 237 
diligence. 238 
 “(e) A notice under subsection (c) of this section must: 239 
 “(1) Specify the manner in which the authorized fiduciary intends to exercise the 240 
decanting power; 241   11 
 
 “(2) Specify the proposed effective date for exercise of the power; 242 
 “(3) Include a copy of the first-trust instrument; and 243 
 “(4) Include a copy of all second-trust instruments. 244 
 “(f) The decanting power may be exercised before expiration of the notice period under 245 
subsection (a) of this section if all persons entitled to receive notice waive the period in a signed 246 
record. 247 
 “(g) The receipt of notice, waiver of the notice period, or expiration of the notice period 248 
does not affect the right of a person to file an application under § 19-1909 asserting that: 249 
 “(1) An attempted exercise of the decanting power is ineffective because it did not 250 
comply with this chapter or was an abuse of discretion or breach of fiduciary duty; or 251 
 “(2) § 19-1922 applies to the exercise of the decanting power. 252 
 “(h) An exercise of the decanting power is not ineffective because of the failure to give 253 
notice to one or more persons under subsection (c) of this section if the authorized fiduciary 254 
acted with reasonable care to comply with subsection (c) of this section. 255 
 Ҥ 19-1908.  Representation. 256 
 “(a) Notice to a person with authority to represent and bind another person under a first-257 
trust instrument or Chapter 13 of this title has the same effect as notice given directly to the 258 
person represented. 259 
 “(b) Consent of or waiver by a person with authority to represent and bind another person 260 
under a first-trust instrument or Chapter 13 of this title is binding on the person represented 261 
unless the person represented objects to the representation before the consent or waiver 262 
otherwise would become effective. 263   12 
 
 “(c) A person with authority to represent and bind another person under a first-trust 264 
instrument or Chapter 13 of this title may file an application under § 19-1909 on behalf of the 265 
person represented. 266 
 “(d) A settlor may not represent or bind a beneficiary under this chapter. 267 
 Ҥ 19-1909.  Court involvement. 268 
 “(a) On application of an authorized fiduciary a person entitled to notice under § 19-269 
1907(c), a beneficiary, or with respect to a charitable interest the Attorney General or other 270 
person that has standing to enforce the charitable interest, the court may: 271 
 “(1) Provide instructions to the authorized fiduciary regarding whether a proposed 272 
exercise of the decanting power is permitted under this chapter and consistent with the fiduciary 273 
duties of the authorized fiduciary; 274 
 “(2) Appoint a special fiduciary and authorize the special fiduciary to determine 275 
whether the decanting power should be exercised under this chapter and to exercise the decanting 276 
power; 277 
 “(3) Approve an exercise of the decanting power; 278 
 “(4) Determine that a proposed or attempted exercise of the decanting power is 279 
ineffective because: 280 
 “(A) After applying § 19-1922, the proposed or attempted exercise does 281 
not or did not comply with this chapter; or  282 
 “(B) The proposed or attempted exercise would be or was an abuse of the 283 
fiduciary’s discretion or a breach of fiduciary duty; 284 
 “(5) Determine the extent to which § 19-1922 applies to a prior exercise of the 285 
decanting power; 286   13 
 
 “(6) Provide instructions to the trustee regarding the application of § 19-1922 to a 287 
prior exercise of the decanting power; or 288 
 “(7) Order other relief to carry out the purposes of this chapter. 289 
 “(b) On application of an authorized fiduciary, the court may approve: 290 
 “(1) An increase in the fiduciary’s compensation under § 19-1916; or 291 
 “(2) A modification under § 19-1918 of a provision granting a person the right to 292 
remove or replace the fiduciary. 293 
 Ҥ 19-1910.  Formalities. 294 
 “An exercise of the decanting power must be made in a record signed by an authorized 295 
fiduciary.  The signed record must, directly or by reference to the notice required by § 19-1907, 296 
identify the first trust and the second trust or trusts and state the property of the first trust being 297 
distributed to each second trust and the property, if any, that remains in the first trust. 298 
 § 19-1911.  Decanting power under expanded distributive discretion. 299 
 “(a) In this section: 300 
 “(1) “Noncontingent right” means a right that is not subject to the exercise of 301 
discretion or the occurrence of a specified event that is not certain to occur.  The term does not 302 
include a right held by a beneficiary if any person has discretion to distribute property subject to 303 
the right to any person other than the beneficiary or the beneficiary’s estate. 304 
 “(2) “Presumptive remainder beneficiary” means a qualified beneficiary other 305 
than a current beneficiary. 306 
 “(3) “Successor beneficiary” means a beneficiary that is not a qualified 307 
beneficiary on the date the beneficiary’s qualification is determined.  The term does not include a 308 
person that is a beneficiary only because the person holds a nongeneral power of appointment. 309   14 
 
 “(4) “Vested interest” means: 310 
 “(A) A right to a mandatory distribution that is a noncontingent right as of 311 
the date of the exercise of the decanting power; 312 
 “(B) A current and noncontingent right, annually or more frequently, to a 313 
mandatory distribution of income, a specified dollar amount, or a percentage of value of some or 314 
all of the trust property; 315 
 “(C) A current and noncontingent right, annually or more frequently, to 316 
withdraw income, a specified dollar amount, or a percentage of value of some or all of the trust 317 
property; 318 
 “(D) A presently exercisable general power of appointment; or 319 
 “(E) A right to receive an ascertainable part of the trust property on the 320 
trust’s termination which is not subject to the exercise of discretion or to the occurrence of a 321 
specified event that is not certain to occur. 322 
 “(b) Subject to subsection (c) of this section and § 19-1914, an authorized fiduciary that 323 
has expanded distributive discretion over the principal of a first trust for the benefit of one or 324 
more current beneficiaries may exercise the decanting power over the principal of the first trust. 325 
 “(c) Subject to § 19-1913, in an exercise of the decanting power under this section, a 326 
second trust may not: 327 
 “(1) Include as a current beneficiary a person that is not a current beneficiary of 328 
the first trust, except as otherwise provided in subsection (d) of this section; 329 
 “(2) Include as a presumptive remainder beneficiary or successor beneficiary a 330 
person that is not a current beneficiary, presumptive remainder beneficiary, or successor 331 
beneficiary of the first trust, except as otherwise provided in subsection (d) of this section; or 332   15 
 
 “(3) Reduce or eliminate a vested interest. 333 
 “(d) Subject to subsection (c)(3) of this section and § 19-1914, in an exercise of the 334 
decanting power under this section, a second trust may be a trust created or administered under 335 
the law of any jurisdiction and may: 336 
 “(1) Retain a power of appointment granted in the first trust; 337 
 “(2) Omit a power of appointment granted in the first trust, other than a presently 338 
exercisable general power of appointment; 339 
 “(3) Create or modify a power of appointment if the powerholder is a current 340 
beneficiary of the first trust and the authorized fiduciary has expanded distributive discretion to 341 
distribute principal to the beneficiary; and 342 
 “(4) Create or modify a power of appointment if the powerholder is a presumptive 343 
remainder beneficiary or successor beneficiary of the first trust, but the exercise of the power 344 
may take effect only after the powerholder becomes, or would have become if then living, a 345 
current beneficiary. 346 
 “(e) A power of appointment described in subsection (d)(1) through (4) of this section 347 
may be general or nongeneral.  The class of permissible appointees in favor of which the power 348 
may be exercised may be broader than or different from the beneficiaries of the first trust. 349 
 “(f) If an authorized fiduciary has expanded distributive discretion over part but not all of 350 
the principal of a first trust, the fiduciary may exercise the decanting power under this section 351 
over that part of the principal over which the authorized fiduciary has expanded distributive 352 
discretion. 353 
 § 19-1912.  Decanting power under limited distributive discretion. 354   16 
 
 “(a) In this section, “limited distributive discretion” means a discretionary power of 355 
distribution that is limited to an ascertainable standard or a reasonably definite standard. 356 
 “(b) An authorized fiduciary that has limited distributive discretion over the principal of 357 
the first trust for benefit of one or more current beneficiaries may exercise the decanting power 358 
over the principal of the first trust. 359 
 “(c) Under this section and subject to § 19-1914, a second trust may be created or 360 
administered under the law of any jurisdiction. Under this section, the second trusts, in the 361 
aggregate, must grant each beneficiary of the first trust beneficial interests which are 362 
substantially similar to the beneficial interests of the beneficiary in the first trust. 363 
 “(d) A power to make a distribution under a second trust for the benefit of a beneficiary 364 
who is an individual is substantially similar to a power under the first trust to make a distribution 365 
directly to the beneficiary.  A distribution is for the benefit of a beneficiary if: 366 
 “(1) The distribution is applied for the benefit of the beneficiary; 367 
 “(2) The beneficiary is under a legal disability or the trustee reasonably believes 368 
the beneficiary is incapacitated, and the distribution is made as permitted under Chapter 13 of 369 
this title; or 370 
 “(3) The distribution is made as permitted under the terms of the first-trust 371 
instrument and the second-trust instrument for the benefit of the beneficiary. 372 
 “(e) If an authorized fiduciary has limited distributive discretion over part but not all of 373 
the principal of a first trust, the fiduciary may exercise the decanting power under this section 374 
over that part of the principal over which the authorized fiduciary has limited distributive 375 
discretion. 376 
 Ҥ 19-1913.  Trust for beneficiary with disability. 377   17 
 
 “(a) In this section: 378 
 “(1) “Beneficiary with a disability” means a beneficiary of a first trust who the 379 
special-needs fiduciary believes may qualify for governmental benefits based on disability, 380 
whether or not the beneficiary currently receives those benefits or is an individual who has been 381 
adjudicated incompetent. 382 
 “(2) “Governmental benefits” means financial aid or services from a state, federal, 383 
or other public agency. 384 
 “(3) “Special-needs fiduciary” means, with respect to a trust that has a beneficiary 385 
with a disability: 386 
 “(A) A trustee or other fiduciary, other than a settlor, that has discretion to 387 
distribute part or all of the principal of a first trust to one or more current beneficiaries; 388 
 “(B) If no trustee or fiduciary has discretion under subparagraph (A), a 389 
trustee or other fiduciary, other than a settlor, that has discretion to distribute part or all of the 390 
income of the first trust to one or more current beneficiaries; or 391 
 “(C) If no trustee or fiduciary has discretion under subparagraphs (A) and 392 
(B), a trustee or other fiduciary, other than a settlor, that is required to distribute part or all of the 393 
income or principal of the first trust to one or more current beneficiaries. 394 
 “(4) “Special-needs trust” means a trust the trustee believes would not be 395 
considered a resource for purposes of determining whether a beneficiary with a disability is 396 
eligible for governmental benefits. 397 
 “(b) A special-needs fiduciary may exercise the decanting power under § 19-1911 over 398 
the principal of a first trust as if the fiduciary had authority to distribute principal to a beneficiary 399 
with a disability subject to expanded distributive discretion if: 400   18 
 
 “(1) A second trust is a special-needs trust that benefits the beneficiary with a 401 
disability; and  402 
 “(2) The special-needs fiduciary determines that exercise of the decanting power 403 
will further the purposes of the first trust. 404 
 “(c) In an exercise of the decanting power under this section, the following rules apply: 405 
 “(1) Notwithstanding § 19-1911(c)(2), the interest in the second trust of a 406 
beneficiary with a disability may: 407 
 “(A) Be a pooled trust as defined by Medicaid law for the benefit of the 408 
beneficiary with a disability under 42 U.S.C. § 1396p(d)(4)(C); or 409 
 “(B) Contain payback provisions complying with reimbursement 410 
requirements of Medicaid law under 42 U.S.C. § 1396p(d)(4)(A). 411 
 “(2) § 19-1911(c)(3) does not apply to the interests of the beneficiary with a 412 
disability. 413 
 “(3) Except as affected by any change to the interests of the beneficiary with a 414 
disability, the second trust, or if there are two or more second trusts, the second trusts in the 415 
aggregate, must grant each other beneficiary of the first trust beneficial interests in the second 416 
trusts which are substantially similar to the beneficiary’s beneficial interests in the first trust. 417 
 Ҥ 19-1914.  Protection of charitable interest. 418 
 “(a) In this section: 419 
 “(1) “Determinable charitable interest” means a charitable interest that is a right to 420 
a mandatory distribution currently, periodically, on the occurrence of a specified event, or after 421 
the passage of a specified time and which is unconditional or will be held solely for charitable 422 
purposes. 423   19 
 
 “(2) “Unconditional” means not subject to the occurrence of a specified event that 424 
is not certain to occur, other than a requirement in a trust instrument that a charitable 425 
organization be in existence or qualify under a particular provision of the United States Internal 426 
Revenue Code of 1986 on the date of the distribution, if the charitable organization meets the 427 
requirement on the date of determination. 428 
 “(b) If a first trust contains a determinable charitable interest, the Attorney General has 429 
the rights of a qualified beneficiary and may represent and bind the charitable interest. 430 
 “(c) If a first trust contains a charitable interest, the second trust or trusts may not: 431 
 “(1) Diminish the charitable interest; 432 
 “(2) Diminish the interest of an identified charitable organization that holds the 433 
charitable interest; 434 
 “(3) Alter any charitable purpose stated in the first-trust instrument; or 435 
 “(4) Alter any condition or restriction related to the charitable interest. 436 
 “(d) If there are two or more second trusts, the second trusts shall be treated as one trust 437 
for purposes of determining whether the exercise of the decanting power diminishes the 438 
charitable interest or diminishes the interest of an identified charitable organization for purposes 439 
of subsection (c) of this section. 440 
 “(e) If a first trust contains a determinable charitable interest, the second trust or trusts 441 
that include a charitable interest pursuant to subsection (c) of this section must be administered 442 
under the law of the District unless: 443 
 “(1) The Attorney General, after receiving notice under § 19-1907, fails to object 444 
in a signed record delivered to the authorized fiduciary within the notice period; 445   20 
 
 “(2) The Attorney General consents in a signed record to the second trust or trusts 446 
being administered under the law of another jurisdiction; or 447 
 “(3) The court approves the exercise of the decanting power. 448 
 “(f) This chapter does not limit the powers and duties of the Attorney General under law 449 
of the District other than this chapter. 450 
 Ҥ 19-1915.  Trust limitation on decanting. 451 
 “(a) An authorized fiduciary may not exercise the decanting power to the extent the first-452 
trust instrument expressly prohibits exercise of: 453 
 “(1) The decanting power; or 454 
 “(2) A power granted by state law to the fiduciary to distribute part or all of the 455 
principal of the trust to another trust or to modify the trust. 456 
 “(b) Exercise of the decanting power is subject to any restriction in the first-trust 457 
instrument that expressly applies to exercise of: 458 
 “(1) The decanting power; or 459 
 “(2) A power granted by state law to a fiduciary to distribute part or all of the 460 
principal of the trust to another trust or to modify the trust. 461 
 “(c) A general prohibition of the amendment or revocation of a first trust, a spendthrift 462 
clause, or a clause restraining the voluntary or involuntary transfer of a beneficiary’s interest 463 
does not preclude exercise of the de 464 
 “(d) Subject to subsections (a) and (b) of this section, an authorized fiduciary may 465 
exercise the decanting power under this chapter even if the first-trust instrument permits the 466 
authorized fiduciary or another person to modify the first-trust instrument or to distribute part or 467 
all of the principal of the first trust to another trust. 468   21 
 
 “(e) If a first-trust instrument contains an express prohibition described in subsection (a) 469 
of this section or an express restriction described in subsection (b) of this section, the provision 470 
must be included in the second-trust instrument. 471 
 Ҥ 19-1916.  Change in compensation. 472 
 “(a) If a first-trust instrument specifies an authorized fiduciary’s compensation, the 473 
fiduciary may not exercise the decanting power to increase the fiduciary’s compensation above 474 
the specified compensation unless: 475 
 “(1) All qualified beneficiaries of the second trust consent to the increase in a 476 
signed record; or  477 
 “(2) The increase is approved by the court. 478 
 “(b) If a first-trust instrument does not specify an authorized fiduciary’s compensation, 479 
the fiduciary may not exercise the decanting power to increase the fiduciary’s compensation 480 
above the compensation permitted by Chapter 13 of this title unless: 481 
 “(1) All qualified beneficiaries of the second trust consent to the increase in a 482 
signed record; or  483 
 “(2) The increase is approved by the court. 484 
 “(c) A change in an authorized fiduciary’s compensation which is incidental to other 485 
changes made by the exercise of the decanting power is not an increase in the fiduciary’s 486 
compensation for purposes of subsections (a) and (b) of this section. 487 
 Ҥ 19-1917.  Relief from liability and indemnification. 488 
 “(a) Except as otherwise provided in this section, a second-trust instrument may not 489 
relieve an authorized fiduciary from liability for breach of trust to a greater extent than the first-490 
trust instrument. 491   22 
 
 “(b) A second-trust instrument may provide for indemnification of an authorized 492 
fiduciary of the first trust or another person acting in a fiduciary capacity under the first trust for 493 
any liability or claim that would have been payable from the first trust if the decanting power had 494 
not been exercised. 495 
 “(c) A second-trust instrument may not reduce fiduciary liability in the aggregate. 496 
 “(d) Subject to subsection (c) of this section, a second-trust instrument may divide and 497 
reallocate fiduciary powers among fiduciaries, including one or more trustees, distribution 498 
advisors, investment advisors, trust protectors, or other persons, and relieve a fiduciary from 499 
liability for an act or failure to act of another fiduciary as permitted by law of the District other 500 
than this chapter. 501 
 Ҥ 19-1918.  Removal or replacement of authorized fiduciary.  502 
 “An authorized fiduciary may not exercise the decanting power to modify a provision in a 503 
first-trust instrument granting another person power to remove or replace the fiduciary unless: 504 
 “(1) The person holding the power consents to the modification in a signed record and the 505 
modification applies only to the person; 506 
 “(2) The person holding the power and the qualified beneficiaries of the second trust 507 
consent to the modification in a signed record and the modification grants a substantially similar 508 
power to another person; or 509 
 “(3) The court approves the modification and the modification grants a substantially 510 
similar power to another person. 511 
 Ҥ 19-1919.  Tax-related limitations. 512 
 “(a) In this section: 513   23 
 
 “(1) “Grantor trust” means a trust as to which a settlor of a first trust is considered 514 
the owner under 26 U.S.C. §§ 671 through 677 or 26 U.S.C. § 679. 515 
 “(2) “Internal Revenue Code” means the United States Internal Revenue Code of 516 
1986. 517 
 “(3) “Nongrantor trust” means a trust that is not a grantor trust. 518 
 “(4) “Qualified benefits property” means property subject to the minimum 519 
distribution requirements of 26 U.S.C. § 401(a)(9), and any applicable regulations, or to any 520 
similar requirements that refer to 26 U.S.C. § 401(a)(9) or the regulations. 521 
 “(b) An exercise of the decanting power is subject to the following limitations: 522 
 “(1) If a first trust contains property that qualified, or would have qualified but for 523 
provisions of this chapter other than this section, for a marital deduction for purposes of the gift 524 
or estate tax under the Internal Revenue Code or a state gift, estate, or inheritance tax, the 525 
second-trust instrument must not include or omit any term that, if included in or omitted from the 526 
trust instrument for the trust to which the property was transferred, would have prevented the 527 
transfer from qualifying for the deduction, or would have reduced the amount of the deduction, 528 
under the same provisions of the Internal Revenue Code or state law under which the transfer 529 
qualified. 530 
 “(2) If the first trust contains property that qualified, or would have qualified but 531 
for provisions of this chapter other than this section, for a charitable deduction for purposes of 532 
the income, gift, or estate tax under the Internal Revenue Code or a state income, gift, estate, or 533 
inheritance tax, the second-trust instrument must not include or omit any term that, if included in 534 
or omitted from the trust instrument for the trust to which the property was transferred, would 535 
have prevented the transfer from qualifying for the deduction, or would have reduced the amount 536   24 
 
of the deduction, under the same provisions of the Internal Revenue Code or state law under 537 
which the transfer qualified. 538 
 “(3) If the first trust contains property that qualified, or would have qualified but 539 
for provisions of this chapter other than this section, for the exclusion from the gift tax described 540 
in 26 U.S.C. § 2503(b), the second-trust instrument must not include or omit a term that, if 541 
included in or omitted from the trust instrument for the trust to which the property was 542 
transferred, would have prevented the transfer from qualifying under 26 U.S.C. § 2503(b).  If the 543 
first trust contains property that qualified, or would have qualified but for provisions of this 544 
chapter other than this section, for the exclusion from the gift tax described in 26 U.S.C. § 545 
2503(b) by application of 26 U.S.C. § 2503(c), the second-trust instrument must not include or 546 
omit a term that, if included or omitted from the trust instrument for the trust to which the 547 
property was transferred, would have prevented the transfer from qualifying under 26 U.S.C. § 548 
2503(c). 549 
 “(4) If the property of the first trust includes shares of stock in an S corporation, 550 
as defined in 26 U.S.C. § 1361 and the first trust is, or but for provisions of this chapter other 551 
than this section would be, a permitted shareholder under any provision of 26 U.S.C. § 1361, an 552 
authorized fiduciary may exercise the power with respect to part or all of the S-corporation stock 553 
only if any second trust receiving the stock is a permitted shareholder under 26 U.S.C. § 554 
1361(c)(2).  If the property of the first trust includes shares of stock in an S corporation and the 555 
first trust is, or but for provisions of this chapter other than this section would be, a qualified 556 
subchapter-S trust within the meaning of 26 U.S.C. § 1361(d), the second-trust instrument must 557 
not include or omit a term that prevents the second trust from qualifying as a qualified 558 
subchapter-S trust. 559   25 
 
 “(5) If the first trust contains property that qualified, or would have qualified but 560 
for provisions of this chapter other than this section, for a zero inclusion ratio for purposes of the 561 
generation-skipping transfer tax under 26 U.S.C. § 2642(c) the second-trust instrument must not 562 
include or omit a term that, if included in or omitted from the first-trust instrument, would have 563 
prevented the transfer to the first trust from qualifying for a zero inclusion ratio under 26 U.S.C. 564 
§ 2642(c). 565 
 “(6) If the first trust is directly or indirectly the beneficiary of qualified benefits 566 
property, the second-trust instrument may not include or omit any term that, if included in or 567 
omitted from the first-trust instrument, would have increased the minimum distributions required 568 
with respect to the qualified benefits property under 26 U.S.C. § 401(a)(9) and any applicable 569 
regulations, or any similar requirements that refer to 26 U.S.C. § 401(a)(9) or the regulations.  If 570 
an attempted exercise of the decanting power violates the preceding sentence, the trustee is 571 
deemed to have held the qualified benefits property and any reinvested distributions of the 572 
property as a separate share from the date of the exercise of the power and Section 22 § 19-1922 573 
applies to the separate share. 574 
 “(7) If the first trust qualifies as a grantor trust because of the application of 26 575 
U.S.C. § 672(f)(2)(A) the second trust may not include or omit a term that, if included in or 576 
omitted from the first-trust instrument, would have prevented the first trust from qualifying under 577 
26 U.S.C. § 672(f)(2)(A). 578 
 “(8) In this paragraph, “tax benefit” means a federal or state tax deduction, 579 
exemption, exclusion, or other benefit not otherwise listed in this section, except for a benefit 580 
arising from being a grantor trust.  Subject to paragraph (9) of this subsection, a second-trust 581   26 
 
instrument may not include or omit a term that, if included in or omitted from the first-trust 582 
instrument, would have prevented qualification for a tax benefit if: 583 
 “(A) The first-trust instrument expressly indicates an intent to qualify for 584 
the benefit or the first-trust instrument clearly is designed to enable the first trust to qualify for 585 
the benefit; and 586 
 “(B) The transfer of property held by the first trust or the first trust 587 
qualified, or but for provisions of this chapter other than this section, would have qualified for 588 
the tax benefit. 589 
 “(9) Subject to paragraph (4) of this subsection: 590 
 “(A) Except as otherwise provided in paragraph (7) of this subsection, the 591 
second trust may be a nongrantor trust, even if the first trust is a grantor trust; and 592 
 “(B) Except as otherwise provided in paragraph (10) of this subsection, the 593 
second trust may be a grantor trust, even if the first trust is a nongrantor trust. 594 
 “(10) An authorized fiduciary may not exercise the decanting power if a settlor 595 
objects in a signed record delivered to the fiduciary within the notice period and: 596 
 “(A) The first trust and a second trust are both grantor trusts, in whole or 597 
in part, the first trust grants the settlor or another person the power to cause the second trust to 598 
cease to be a grantor trust, and the second trust does not grant an equivalent power to the settlor 599 
or other person; or 600 
 “(B) The first trust is a nongrantor trust and a second trust is a grantor 601 
trust, in whole or in part, with respect to the settlor, unless: 602 
 “(i) The settlor has the power at all times to cause the second trust 603 
to cease to be a grantor trust; or  604   27 
 
 “(ii) The first-trust instrument contains a provision granting the 605 
settlor or another person a power that would cause the first trust to cease to be a grantor trust and 606 
the second-trust instrument contains the same provision. 607 
 Ҥ 19-1920.  Duration of second trust. 608 
 “(a) Subject to subsection (b) of this section, a second trust may have a duration that is 609 
the same as or different from the duration of the first trust. 610 
 “(b) To the extent that property of a second trust is attributable to property of the first 611 
trust, the property of the second trust is subject to any rules governing maximum perpetuity, 612 
accumulation, or suspension of the power of alienation which apply to property of the first trust. 613 
 Ҥ 19-1921.  Need to distribute not required. 614 
 “An authorized fiduciary may exercise the decanting power whether or not under the first 615 
trust’s discretionary distribution standard the fiduciary would have made or could have been 616 
compelled to make a discretionary distribution of principal at the time of the exercise. 617 
 Ҥ 19-1922.  Saving provision. 618 
 “(a) If exercise of the decanting power would be effective under this chapter except that 619 
the second-trust instrument in part does not comply with this chapter, the exercise of the power is 620 
effective and the following rules apply with respect to the principal of the second trust 621 
attributable to the exercise of the power: 622 
 “(1) A provision in the second-trust instrument which is not permitted under this 623 
chapter is void to the extent necessary to comply with this chapter. 624 
 “(2) A provision required by this chapter to be in the second-trust instrument 625 
which is not contained in the instrument is deemed to be included in the instrument to the extent 626 
necessary to comply with this chapter. 627   28 
 
 “(b) If a trustee or other fiduciary of a second trust determines that subsection (a) of this 628 
section applies to a prior exercise of the decanting power, the fiduciary shall take corrective 629 
action consistent with the fiduciary’s duties. 630 
 Ҥ 19-1923.  Trust for care of animal. 631 
 “(a) In this section: 632 
 “(1) “Animal trust” means a trust or an interest in a trust created to provide for the 633 
care of one or more animals. 634 
 “(2) “Protector” means a person appointed in an animal trust to enforce the trust 635 
on behalf of the animal or, if no such person is appointed in the trust, a person appointed by the 636 
court for that purpose. 637 
 “(b) The decanting power may be exercised over an animal trust that has a protector to 638 
the extent the trust could be decanted under this chapter if each animal that benefits from the 639 
trust were an individual, if the protector consents in a signed record to the exercise of the power. 640 
 “(c) A protector for an animal has the rights under this chapter of a qualified beneficiary. 641 
 “(d) Notwithstanding any other provision of this chapter, if a first trust is an animal trust, 642 
in an exercise of the decanting power, the second trust must provide that trust property may be 643 
applied only to its intended purpose for the period the first trust benefitted the animal. 644 
 Ҥ 19-1924.  Terms of second trust. 645 
 “A reference in Chapter 13 of this title to a trust instrument or terms of the trust includes 646 
a second-trust instrument and the terms of the second trust. 647 
 Ҥ 19-1925.  Settlor. 648 
 “(a) For purposes of law of the District other than this chapter and subject to subsection 649 
(b) of this section, a settlor of a first trust is deemed to be the settlor of the second trust with 650   29 
 
respect to the portion of the principal of the first trust subject to the exercise of the decanting 651 
power. 652 
 “(b) In determining settlor intent with respect to a second trust, the intent of a settlor of 653 
the first trust, a settlor of the second trust, and the authorized fiduciary may be considered. 654 
 Ҥ 19-1926.  Later-discovered property. 655 
 “(a) Except as otherwise provided in subsection (c) of this section, if exercise of the 656 
decanting power was intended to distribute all the principal of the first trust to one or more 657 
second trusts, later-discovered property belonging to the first trust and property paid to or 658 
acquired by the first trust after the exercise of the power is part of the trust estate of the second 659 
trust or trusts. 660 
 “(b) Except as otherwise provided in subsection (c) of this section, if exercise of the 661 
decanting power was intended to distribute less than all the principal of the first trust to one or 662 
more second trusts, later-discovered property belonging to the first trust or property paid to or 663 
acquired by the first trust after exercise of the power remains part of the trust estate of the first 664 
trust. 665 
 “(c) An authorized fiduciary may provide in an exercise of the decanting power or by the 666 
terms of a second trust for disposition of later-discovered property belonging to the first trust or 667 
property paid to or acquired by the first trust after exercise of the power. 668 
 Ҥ 19-1927.  Obligations. 669 
 “A debt, liability, or other obligation enforceable against property of a first trust is 670 
enforceable to the same extent against the property when held by the second trust after exercise 671 
of the decanting power. 672 
 Ҥ 19-1928.  Uniformity of application and construction. 673   30 
 
 “In applying and construing this uniform act, consideration must be given to the need to 674 
promote uniformity of the law with respect to its subject matter among states that enact it. 675 
 Ҥ 19-1929.  Relation to electronic signatures in global and national commerce act. 676 
 “This chapter modifies, limits, or supersedes the Electronic Signatures in Global and 677 
National Commerce Act, 15 U.S.C. § 7001 et seq., but does not modify, limit, or supersede 678 
section 101(c) of that act, 15 U.S.C. § 7001(c), or authorize electronic delivery of any of the 679 
notices described in section 103(b) of that act, 15 U.S.C. § 7003(b).” 680 
 Sec. 3. Fiscal impact statement. 681 
 The Council adopts the fiscal impact statement in the committee report as the fiscal 682 
impact statement required by section 602(c)(3) of the District of Columbia Home Rule Act, 683 
approved December 24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(3)) 684 
 Sec.  4.  Effective date. 685 
 This act shall take effect following approval by the Mayor (or in the event of veto by the 686 
Mayor, action by the Council to override the veto), a 30-day period of Congressional review as 687 
provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December 688 
24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(1)), and publication in the District of 689 
Columbia Register. 690