SB 94 Summary

• Establishes that powers of appointment are nonfiduciary unless granted to a trustee or fiduciary in their fiduciary capacity, and may be exercised in any lawful manner subject only to express limitations in the grant instrument.

• Property subject to nonfiduciary powers of appointment is protected from creditor claims of the power holder and the settlor, except as provided in AS 34.40.115.

• Expands trustee powers to appoint trust principal to new trusts, distinguishing between "unlimited authorized trustees" (non-settlor, non-beneficiary trustees) who have broader appointment powers and "limited authorized trustees" (settlor or beneficiary trustees) who face more restrictions.

• Allows trustees to divide trusts created by multiple settlors into separate portions for income tax purposes by tracing contributions and earnings to each settlor.

• Modifies the rule against perpetuities to allow second powers of appointment created within 1,000 years of the first power's exercise, with immediate effectiveness upon enactment.