Also known as: general testamentary powers · general power of appointment
Written by attorneys · grounded in primary & secondary sources — see below
A power of appointment exercisable only by the donee's will that permits appointment of the subject property to the donee, the donee's creditors, the donee's estate, or the creditors of the donee's estate.
Testator A transfers a fund in trust to pay income to B for life and then to pay the principal to such persons as B shall by will appoint. B therefore holds a general testamentary power. B may appoint the property to B's own estate or creditors.
A decedent's will placed residue in trust with income to his wife for life and granted her a general testamentary power over the corpus. The wife exercised the power by will in favor of her estate. The estate tax return treated the trust as qualifying for the marital deduction because the power met the statutory requirements for general testamentary powers.
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A husband created an inter vivos trust during marriage and retained a general testamentary power over the assets. Upon his death the surviving spouse sought to include the trust property in the elective share calculation. The court held that the retained power did not render the trust testamentary, so the assets remained outside the probate estate for elective share purposes.
Under the Restatement rule, property subject to a self-created general testamentary power is reachable by the donee's creditors to the same extent as if the donee owned the property outright. Third-party-created testamentary powers receive different treatment at death under related provisions.
A presently exercisable general power created by a third party subjects the property to creditors when the donee's own assets are insufficient. A general testamentary power is not presently exercisable during life and is governed by distinct rules that may or may not permit creditor access depending on the jurisdiction and whether the power was self-created.
A general testamentary power is not treated as equivalent to ownership. The power itself and interests appointed under it are measured from the time the power was created, not from the time of exercise, and must vest within lives in being plus twenty-one years.
…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.…