Laws, Regulations & Annotations

Property Taxes Law Guide – Revision 2017

Property Tax Annotations

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Annotation 625.0234

625.0234 Trusts—Powers of Appointment. A general power of appointment authorizes the holder to transfer trust assets to himself, his estate, or any person. A special power of appointment limits the persons or entities to whom assets may be transferred.

The transfer of trust property by a parent, who is the sole income beneficiary, pursuant to a general power of appointment to the parent's living trust, in which he is the sole income beneficiary, results in no change in the present beneficial interest in the property. Upon the parent's death, the transfer of the trust property to his children qualifies for the parent-child exclusion as a transfer by the parent, providing a timely claim is filed.

In the case of a related trust in which the parent has a limited power of appointment, a transfer of trust property pursuant to that power to his children would be considered a transfer from the trustor, not the parent; and the parent-child exclusion would apply or not, depending upon the relationship between the trustor and the children. C 12/14/1990.