22nd Alaska State Legislature
Information from Representative Lesil McGuire (R)



Portrait of Representative Lesil McGuire, 123.4 K. Session:
State Capitol, Room 418
Juneau, AK 99801-1182
Phone: (907) 465-2995
Fax: (907) 465-6592


Interim:
716 W. 4th Ave., Suite 430
Anchorage, AK 99501-2133
Phone: (907) 269-0250
Fax: (907) 269-0249

Sponsor Statement for HB 34
Rule Against Perpetuities

An Act relating to the statutory rule against perpetuities, to nonvested property interests and trusts, and to the suspension of the power of alienation of property; and providing for an effective date.

Last updated:


March 7, 2001

Contact:


Jacqueline Sierer, Aide to Representative Lesil McGuire, at (907) 465-2995

Alaska has become the most forward thinking trust jurisdiction in the United States and our trust laws have become the model by which other states have changed their respective laws. Our trust laws have been carefully scrutinized and commented upon by nonresident practitioners as well as legal academicians. To maintain Alaska's position as a leader in trusts, our trust laws need to be a model of clarity. As with most technically complex areas, trust law legislation must evolve to meet its intended purpose.

Senate Bill No. 162, as passed by the Twenty-First legislature in the Second Session, corrected the deficiency found in our state's previous version of the Rule Against Perpetuities. In that version any beneficiary of a generation-skipping trust who exercised a non-general power of appointment to create a successive trust giving the beneficiaries of the second trust a non-general power of appointment, created an immediate estate or gift tax liability under Internal Revenue Code sections 2041(a)(3) and 2514(d). This tax trap has become known in estate planning circles as the Delaware Tax Trap. House Bill 34 is a technical correction to Senate Bill 162 and clarifies the wording and application of the previously passed statute in making the same distinction that the common law has made between a presently exercisable general power of appointment and testamentary general power of appointment.

Sectional Analysis for HB 34

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Attachments:

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