Spouse Did Not Have Power of Appointment Over Property Held in Trust, Despite Her Trusteeship

In PLR 200847015 (TAM, Nov. 21, 2008), the IRS stated in technical advice, that a surviving spouse who was named trustee of a trust did not hold a general power of appointment, when she was authorized to distribute to herself income and principal as she deemed necessary for her health, support, and maintenance. The IRS relied on Rev Rul 78-398, 1978-2 CB 237 , in which the power of a decedent who was the income beneficiary and sole trustee of a trust to apply as much of the trust principal as necessary for such trustee-beneficiary's maintenance and medical care, which power was limited by an ascertainable standard under local law, was limited by an ascertainable standard relating to maintenance and health within the meaning of Code Sec. 2041(b)(1)(A) , and was not a general power of appointment.

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