Also known as: general presently exercisable powers · presently exercisable general power · general power of appointment
Written by attorneys · grounded in primary & secondary sources — see below
A power of appointment that the holder may exercise at any time to appoint property to the holder, the holder's estate, or the creditors of either.
Gina Griffin is the sole beneficiary of a trust holding startup shares. The instrument permits her to demand any amount of principal by written notice to the trustee at any time. When a creditor seeks to reach the shares, the right qualifies because Gina alone controls exercise without standards or third-party approval.
Gloria Green creates an inter vivos trust during marriage and retains a right to withdraw all principal on demand. After her death her surviving spouse claims the assets for the elective share. The retained withdrawal authority brings the property into the estate calculation because it functions as an unrestricted present power.
Select any source to read its text and confirm it supports the definition.
Genevieve Gardner holds a right to withdraw trust principal immediately upon written request. In a later federal estate tax dispute the state court decree addresses whether the power is presently exercisable. The federal court determines the character of the power by applying the governing state rule to the withdrawal language.
The right qualifies when the beneficiary may withdraw at any time without an ascertainable standard and without needing consent from a trustee or adverse party. The definition excludes powers held by a trustee and limited by health, education, support, or maintenance standards. It also excludes powers that another person may exercise only with trustee or adverse-party consent.
Supporting sources
Yes. When withdrawal requires written consent from a person whose own beneficial interest would be reduced by the withdrawal, the power falls outside the definition. The adverse interest of the co-trustee as remainderman supplies an independent ground for exclusion even if the consent is also viewed as trustee consent.
Supporting sources
The informal view has no effect. Classification turns on the trust instrument's actual language. If the document grants an unconditional right to withdraw principal on demand, the power remains presently exercisable regardless of the trustee's personal interpretation or attempted limitation.
Supporting sources
…A and was entitled to reach the principal at his request or in the trustee’s discretion. The trust instrument also gave Mayo a general power of appointment over the assets in Trust A. The balance of the decedent’s estate, excluding personal property passing to Mayo by will, or the entire estate if Mayo did not survive her, composed Trust B.…