1. (a) As used in this section, "power of appointment" means a power that enables a person acting in a nonfiduciary capacity to designate a recipient of an ownership interest in or another power of appointment over trust property.

2. (b) This chapter does not apply to a:

   1. (1) power of appointment;
   2. (2) power to appoint or remove a trustee or trust director;
   3. (3) power of a settlor over a trust to the extent the settlor has a power to revoke the trust;

   4. (4) power of a beneficiary over a trust to the extent the exercise or nonexercise of the power affects the beneficiary interest of:

      1. (A) the beneficiary; or
      2. (B) another beneficiary represented by the beneficiary with respect to the exercise or nonexercise of the power; or

   5. (5) power over a trust if:

      1. (A) the terms of the trust provide that the power is held in a nonfiduciary capacity; and
      2. (B) the power must be held in a nonfiduciary capacity to achieve the settlor's tax objectives under the Internal Revenue Code.
3. (c) Unless the terms of a trust provide otherwise, a power granted to a person to designate a recipient of an ownership interest in or power of appointment over trust property that is exercisable while the person is not serving as a trustee is a power of appointment and not a power of direction.

As added by P.L.221-2019, SEC.10.