KRS 386B.13-110: Decanting power under limited distributive discretion.

(1) As used in this section, "limited distributive discretion" means a discretionary

power of distribution that is limited to an ascertainable standard or a reasonably

definite standard.

(2) An authorized fiduciary that has limited distributive discretion over the principal of

the first trust for the benefit of one (1) or more current beneficiaries may exercise

the decanting power over the principal of the first trust.

(3) Under this section and subject to KRS 386B.13 -130, a second trust may be created

or administered under the law of any jurisdiction. Under this section, the second

trusts, in the aggregate, shall grant each beneficiary of the first trust beneficial

interests which are substantially similar to the beneficial interests of the beneficiary

of the first trust.

(4) A power to make a distribution under a second trust for the benefit of a beneficiary

who is an individual is substantially similar to a power under the first trust to make

a distribution directly to the beneficiary. A distribution is for the benefit of a

beneficiary if:

(a) The distribution is applied for the benefit of the beneficiary;

(b) The beneficiary is under a legal disability or the trustee reasonably believ es

the beneficiary is incapacitated, and the distribution is made as permitted

under this chapter; or

(c) The distribution is made as permitted under the terms of the first -trust

instrument and the second-trust instrument for the benefit of the beneficiary.

(5) If an authorized fiduciary has limited distributive discretion over part but not all of

the principal of a first trust, the fiduciary may exercise the decanting power under

this section over that part of the principal over which the authorized fiduci ary has

limited distributive discretion.