Also known as: presently-exercisable · currently exercisable
Written by attorneys · grounded in primary & secondary sources — see below
A power of appointment that the donee may exercise immediately at the time in question. The donor has not manifested an intent to postpone exercise until a future event or to limit exercise to a will.
Lena holds a beneficial interest in a trust holding startup stock. The trust instrument permits her to demand any amount of principal at any time by written notice to the trustee. Because Lena may act unilaterally without trustee consent or an ascertainable standard, her right qualifies as presently exercisable and constitutes a power of withdrawal.
A settlor creates a trust but retains an unrestricted right during life to revoke the trust and reclaim the assets. The retained right is presently exercisable because the settlor may destroy the trust at any moment for personal benefit, rendering the future interests subject to that power destructible for perpetuities analysis.
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A presently exercisable power may be exercised by deed or other lifetime act at the time in question. A testamentary power may be exercised only by will and therefore is not presently exercisable.
Supporting sources
The power qualifies when it is a presently exercisable general power of appointment held by a beneficiary and is neither limited by an ascertainable standard when held by a trustee nor subject to consent by the trustee or an adverse party.
Supporting sources
Yes. The donee of a presently exercisable power may contract to appoint provided the contract and appointment benefit only objects of the power.
Supporting sources
The period during which a person holds an uncontrolled, personally beneficial power to destroy future interests is disregarded when measuring the perpetuities period.
…prerequisite for an application of the rule stated in Section 373 can exist when the power of disposition (or revocation) is not presently exercisable at the time of its creation, provided that the period, during which the exercise of such power is postponed, does not invalidate all interests created by the exercise of such power, and…