2009 Kentucky Revised Statutes CHAPTER 381 TITLE TO PROPERTY AND RESTRICTIONS ON USE, OWNERSHIP, AND ALIENATION 381.180 Estates in trust subject to debts of beneficiary -- Spendthrift trusts excepted -- Other exceptions.
381.180 Estates in trust subject to debts of beneficiary -- Spendthrift trusts
excepted -- Other exceptions.
(1) Estates of every kind held or possessed in trust shall be subject to the debts and
charges of the beneficiaries thereof the same as if the beneficiaries also owned the <br>similar legal interest in the property, unless the trust is a spendthrift trust.
(2) As used herein, unless the context otherwise requires, "spendthrift trust" means a
trust in which by the terms of the instrument creating it a valid restraint on the <br>voluntary and involuntary alienation of the interest of a beneficiary is imposed.
(3) Specific language shall not be necessary to create a spendthrift trust and it shall be
sufficient if the instrument creating the trust manifests an intention to create a <br>spendthrift trust.
(4) If an instrument creating a trust provides that a beneficiary is entitled to receive
income of the trust and that his interest shall not be alienable by him and shall not <br>be subject to alienation by operation of law or legal process, the restraint on the <br>voluntary and involuntary alienation of his right to income due and to accrue shall <br>be valid.
(5) If an instrument creating a trust provides that a beneficiary is entitled to receive
principal of the trust at a future time and that his interest shall not be alienable by <br>him and shall not be subject to alienation by operation of law or legal process, the <br>restraint on the voluntary and involuntary alienation of his right to principal shall be <br>valid.
(6) Although a trust is a spendthrift trust, the interest of the beneficiary shall be subject
to the satisfaction of an enforceable claim against the beneficiary: <br>(a) By the spouse or child of the beneficiary for support, or by the spouse for
maintenance;
(b) If the trust is not a trust described in subsection (7)(b) of this section by
providers of necessary services rendered to the beneficiary or necessary <br>supplies furnished to him; and
(c) By the United States or the Commonwealth of Kentucky for taxes due from
him on account of his interest in the trust or the income therefrom.
(7) (a) If a person creates for his own benefit a trust with a provision restraining the
voluntary or involuntary alienation of his interest, his interest nevertheless <br>shall be subject to alienation by operation of law or legal process.
(b) This subsection shall not be construed to subject to alienation any interest in
an individual retirement account or annuity, tax sheltered annuity, simplified <br>employee pension, pension, profit-sharing, stock bonus, or other retirement <br>plan described in the Internal Revenue Code of 1986, as amended, which <br>qualifies for the deferral of current income tax until the date benefits are <br>distributed.
Effective: July 13, 1990 <br>History: Amended 1990 Ky. Acts ch. 220, sec. 1, effective July 13, 1990. -- Amended
1974 Ky. Acts ch. 386, sec. 69. -- Amended 1966 Ky. Acts ch. 61, sec. 1. --
Recodified 1942 Ky. Acts ch. 208, sec. 1, effective October 1, 1942, from Ky. Stat. <br>sec. 2355.
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