2009 Kansas Code
Chapter 79 TAXATION
Article 15 DEATH TAXES
79-15,214. Same; property in respect to which decedent had a general power of appointment.

79-15,214

Chapter 79.--TAXATION Article 15.--DEATH TAXES

      79-15,214.   Same; property in respect to which decedent had a general power of appointment. (a) The value of the gross estate shall include the value of all property: (1) To the extent of any property with respect to which the decedent has at the time of death a general power of appointment, or with respect to which the decedent has at any time exercised or released such a power of appointment by a disposition which is of such nature that if it were a transfer of property owned by the decedent, such property would be includable in the decedent's gross estate under K.S.A. 2009 Supp. 79-15,209 through 79-15,211, and amendments thereto. For purposes of this subsection, the power of appointment shall be considered to exist on the date of the decedent's death even though the exercise of the power is subject to a precedent giving of notice or even though the exercise of the power takes effect only on the expiration of a stated period after its exercise, whether or not on or before the date of the decedent's death notice has been given or the power has been exercised; and

      (2)   to the extent of any property with respect to which the decedent by will, or by a disposition which is of such nature that if it were a transfer of property owned by the decedent such property would be includable in the decedent's gross estate under K.S.A. 2009 Supp. 79-15,209 or 79-15,210, and amendments thereto, exercises a power of appointment by creating another power of appointment which under applicable local law can be validly exercised so as to postpone the vesting of any estate or interest in such property, or suspend the absolute ownership or power of alienation of such property, for a period ascertainable without regard to the date of the creation of the first power.

      (b)   For purposes of subsection (a): (1) The term "general power of appointment" means a power which is exercisable in favor of the decedent, the decedent's estate, the decedent's creditors or the creditors of the decedent's estate, except that:

      (A)   A power to consume, invade or appropriate property for the benefit of the decedent which is limited by an ascertainable standard relating to the health, education, support or maintenance of the decedent shall not be deemed a general power of appointment; and

      (B)   in the case of a power of appointment which is exercisable by the decedent only in conjunction with another person:

      (i)   If the power is not exercisable by the decedent except in conjunction with the creator of the power, such power shall not be deemed a general power of appointment;

      (ii)   if the power is not exercisable by the decedent except in conjunction with a person having a substantial interest in the property, subject to the power, which is adverse to exercise of the power in favor of the decedent, such power shall not be deemed a general power of appointment. For the purposes of this clause a person who, after the death of the decedent, may be possessed of a power of appointment, with respect to the property subject to the decedent's power, which the person may exercise in such person's own favor shall be deemed as having an interest in the property and such interest shall be deemed adverse to such exercise of the decedent's power; and

      (iii)   if, after the application of clauses (i) and (ii), the power is a general power of appointment and is exercisable in favor of such other person, such power shall be deemed a general power of appointment only in respect of a fractional part of the property subject to such power, such part to be determined by dividing the value of such property by the number of such persons, including the decedent, in favor of whom such power is exercisable.

      For purposes of clauses (ii) and (iii), a power shall be deemed to be exercisable in favor of a person, if it is exercisable in favor of such person, the person's estate, the person's creditors or the creditors of the person's estate.

      (2)   The lapse of a power of appointment during the life of the individual possessing the power shall be considered a release of such power, except that the lapse of a power as provided in this subsection shall apply during any calendar year only to the extent that the property, which could have been appointed by exercise of such lapsed powers, exceeded in value, at the time of such lapse, the greater of the following amounts: (A) $5,000; or (B) 5% of the aggregate value, at the time of such lapse, of the assets out of which, or the proceeds of which, the exercise of the lapsed powers could have been satisfied.

      History:   L. 2006, ch. 199, § 14; Jan. 1, 2007.