Alabama SB179: Alabama Uniform Trust Code; amended to conform with Alabama Qualified Dispositions in Trust Act, limit property subject to creditors' claims

What the bill says

An Act, Relating to trusts; to amend Section 19-3B-505, Code of Alabama 1975, to limit creditor claims to conform to the Alabama Qualified Dispositions in Trust Act; to limit when a holder of a withdrawal power is considered a settlor; to amend Section 19-3B-816, Code of Alabama 1975, to allow a trustee to reimburse a settlor for income taxes paid or payable without such amount being subject to the claims of the settlor's creditors; and to make nonsubstantive, technical revisions to update the existing code language to current style.

From the enrolled text:

An Act, Relating to trusts; to amend Section 19-3B-505, Code of Alabama 1975, to limit creditor claims to conform to the Alabama Qualified Dispositions in Trust Act; to limit when a holder of a withdrawal power is considered a settlor; to amend Section 19-3B-816, Code of Alabama 1975, to allow a trustee to reimburse a settlor for income taxes paid or payable without such amount being subject to the claims of the settlor's creditors; and to make nonsubstantive, technical revisions to update the existing code language to current style. BE IT ENACTED BY THE LEGISLATURE OF ALABAMA: Section 1. Sections 19-3B-505 and 19-3B-816, Code of Alabama 1975, are amended to read as follows: "§19-3B-505 (a) Whether or not the terms of a trust contain a spendthrift provision, the following rules apply: (1) During the lifetime of the settlor, the property of a revocable trust is subject to claims of the settlor's creditors. (2) With Except as provided in Chapter 3E, with respect to an irrevocable trust, a creditor or assignee of the settlor may reach the maximum amount that can be distributed to or for the settlor's benefit. If a trust has more than one settlor, then the amount the creditor or assignee of a particular settlor may reach may not exceed the settlor's interest in the portion of the …

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Sponsors

• Barfoot, Will (R, SD-025) · primary sponsor