AR HB1431

Amends Arkansas Trust Code definition of "ascertainable standard" to reference Internal Revenue Code provisions as they existed on January 1, 2023 (changed from September 1, 2005).

Allows trustees to appoint or "decant" property from an original trust to a second trust, provided beneficiaries of the second trust are limited to current or potential beneficiaries of the original trust.

Prohibits decanting if it would reduce income interests of beneficiaries, affect marital or charitable deductions taken for tax purposes, impact withdrawal powers, or violate gift tax exclusion requirements under federal law.

Restricts trustee-beneficiaries and removable trustees from decanting in ways that would increase their own distributions unless limited by ascertainable standards, protecting against self-dealing.

Permits decanting to special needs trusts, pooled trusts, or third-party trusts established for supplemental needs of persons eligible for Medicaid or needs-based public assistance.