{"data":{"id":"us-ky/krs-386b.5-040","jurisdiction":"us-ky","citation":"KRS 386B.5-040","heading":"Creditor's claim against settlor.","body":"(1) Subject to the statutory provisions of KRS Chapter 396 regarding claims against\ndecedents' estates, whether or not the terms of a trust contain a spendthrift\nprovision, the following rules apply:\n(a) During the lifetime of the settlor, the property of a revocable trust is subject to\nclaims of the settlor's creditors;\n(b) With respect to an irrevocable trust, a creditor or assignee of the settlor may\nreach the maximum amount that can be distributed to or for the settlor's\nbenefit. If a trust has more than on e (1) settlor, the amount the creditor or\nassignee of a particular settlor may reach may not exceed the settlor's interest\nin the portion of the trust attributable to that settlor's contribution; and\n(c) After the death of a settlor, and subject to the settlor's right to direct the source\nfrom which liabilities shall paid, the property of a trust that was revocable at\nthe settlor's death is subject to claims of the settlor's creditors, costs of\nadministration of the settlor's estate, the expenses of the set tlor's funeral and\ndisposal of remains, and statutory allowances to a surviving spouse and\nchildren to the extent the settlor's probate estate is inadequate to satisfy those\nclaims, costs, expenses, and allowances, but no property added to a revocable\ntrust on account of the settlor's death from a source other than the settlor's\nestate or another revocable trust created by the settlor shall be subject to\nclaims of the settlor's creditors, costs of administration of the settlor's estate,\nthe expenses of the settlor's funeral and disposal of remains, and statutory\nallowances to a surviving spouse and children.\n(2) For purposes of this section:\n(a) During the period the power may be exercised, the holder of a power of\nwithdrawal is treated in the same manner as  the settlor of a revocable trust to\nthe extent of the property subject to the power; and\n(b) Upon the lapse, release, or waiver of the power, the holder is not treated as the\nsettlor of the trust.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=43106","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:59:19Z","sha256":"f208cd39aac945af526cf308743bd1b0095440382f49eb69f6a9d61d69e31ec5","source_id":"us-ky","stale":false,"prev":"us-ky/krs-386b.5-030","next":"us-ky/krs-386b.5-050"},"notice":"GroundRules: Original legal text. Not legal advice."}