EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb0050*
HOUSE BILL 50
N2 5lr1549
(PRE–FILED) CF SB 12
By: Delegate Cardin
Requested: October 31, 2024
Introduced and read first time: January 8, 2025
Assigned to: Judiciary
A BILL ENTITLED
AN ACT concerning 1
Estates and Trusts – Spousal Lifetime Access Trusts 2
FOR the purpose of adding to the conditions under which an individual who creates a trust 3
may not be considered the settlor of the trust with regard to the individual’s interest 4
in the trust; providing that a creditor of an individual may not attach, exercise, reach, 5
or otherwise compel distribution of certain trust assets in certain circumstances; and 6
generally relating to spousal lifetime access trusts. 7
BY repealing and reenacting, with amendments, 8
Article – Estates and Trusts 9
Section 14.5–1003 10
Annotated Code of Maryland 11
(2022 Replacement Volume and 2024 Supplement) 12
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 13
That the Laws of Maryland read as follows: 14
Article – Estates and Trusts 15
14.5–1003. 16
(A) IN THIS SECTION , “SPOUSE” MEANS THE INDIVIDUAL TO WHOM AN 17
INDIVIDUAL WHO CREAT ED A TRUST WAS MARRI ED AT THE TIME THE T RUST WAS 18
CREATED. 19
[(a)] (B) An individual who creates a trust may not be considered the settlor of 20
that trust with regard to the individual’s interest in the trust if: 21
(1) That interest is the authority of the trustee under the trust instrument 22 2 HOUSE BILL 50
or any other provision of law to pay or reimburse the individual for any tax on trust income 1
or trust principal that is payable by the individual under the law imposing that tax; [or] 2
(2) All of the following apply: 3
(i) The individual creates or has created the trust for the benefit of 4
the individual’s spouse; 5
(ii) The trust is treated as qualified terminable interest property 6
under § 2523(f) of the Internal Revenue Code of 1986; and 7
(iii) The individual’s interest in the trust income, trust principal, or 8
both follows the termination of the spouse’s prior interest in the trust; OR 9
(3) ALL OF THE FOLLOWING APPLY: 10
(I) THE INDIVIDUAL CREATE S OR HAS CREATED THE TRUST: 11
1. FOR THE BENEFIT OF TH E INDIVIDUAL’S SPOUSE 12
DURING THE LIFETIME OF THE SPOUSE ; OR 13
2. FOR THE BENEFIT OF TH E INDIVIDUAL’S SPOUSE AND 14
ANY OTHER BENEFICIAR Y DURING THE LIFETIM E OF THE SPOUSE ; 15
(II) THE TRUST DOES NOT ME ET THE REQUIREMENTS OF ITEM 16
(2) OF THIS SUBSECTION ; 17
(III) THE TRUST IS IRREVOCA BLE; AND 18
(IV) AFTER THE DEATH OF TH E INDIVIDUAL’S SPOUSE, THE 19
INDIVIDUAL IS A BEN EFICIARY OF THE TRUS T THROUGH THE EXERCI SE OF A POWER 20
OF APPOINTMENT BY TH E INDIVIDUAL’S SPOUSE OR BY ANOTH ER INDIVIDUAL WHO 21
DID NOT CREATE THE T RUST. 22
[(b)] (C) A creditor of an individual described in subsection [(a)] (B) of this 23
section may not attach, exercise, reach, or otherwise compel distribution of: 24
(1) Any principal or income of the trust; 25
(2) Any principal or income of any other trust to the extent that the 26
property held in the other trust is attributable to a trust described in subsection [(a)(2)] 27
(B)(2) OR (3) of this section; 28
(3) The individual’s interest in the trust; or 29
HOUSE BILL 50 3
(4) The individual’s interest in any other trust to the extent that the 1
property held in the other trust is attributable to a trust described in subsection [(a)(2)] 2
(B)(2) OR (3) of this section. 3
[(c)] (D) This section may not be construed to affect any State law with respect 4
to a fraudulent transfer by an individual to a trustee. 5
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 6
October 1, 2025. 7