Powers of appointment add additional flexibility to the traditional estate planning tools but the various powers need to be approached with care and examined critically for unexpected consequences.1 Powers of appointment involve powers given to another, usually to control the ultimate disposition of specified property, in contrast with those powers created or retained by a person. General powers of appointment2 are relatively well known and are included in many drafting guides and can be exercised to benefit the holder of the power; so-called “special” powers of appointment sidestep that major feature of general powers; powers limited as to exercise by an “ascertainable standard”3 are distinguished, also, from general powers. A power giving the non-cumulative right to withdraw each year up to the greater of five percent of trust principal or $5,0004 adds an additional element of financial security for the surviving spouse without causing inclusion in the surviving spouse’s gross estate at death but may pose consequences in the year of death for withdrawal rights that had not been exercised in that year.5



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