ID S1052

Amends Idaho Code Section 15-7-502 regarding spendthrift trusts to allow settlors to restrict voluntary or involuntary transfer of beneficiary interests in income or principal before payment or delivery by the trustee.

Clarifies that a "spendthrift trust" declaration in a trust instrument is sufficient to restrain alienation to the maximum extent permitted, and validity does not require specific reference to identical statutory language.

Provides that when a person is both settlor and beneficiary, creditors can satisfy claims from the settlor's contributed portion, except for irrevocable grantor trusts where the settlor's only beneficial interest is a distribution equal to or less than federal and state income tax liability incurred by the trust.

Specifies that beneficiaries are not considered settlors merely because of lapses, waivers, or releases of powers or withdrawal rights, provided the value affected in any calendar year does not exceed amounts specified in Internal Revenue Code sections 2041(b)(2), 2514(e), or 2503(b).

Clarifies that a beneficiary is not considered a settlor for holding or exercising presently exercisable powers to consume or distribute trust property, testamentary powers of appointment, or limited powers of appointment, even when acting as trustee.