Juneau -- Thursday the Alaska Senate passed legislation that allows Alaska to be more competitive in the national trust market. Senate Bill 163, sponsored by the Senate Judiciary Committee, would allow trust creators to maintain their privacy by delaying notification of trust beneficiaries.

"Many people have told me that while they would like to set up a financial trust for a beneficiary, they don't necessarily want that person to be aware of their beneficiary status," said Senate Judiciary Chair Robin Taylor, (R-Wrangell). "They have expressed concern that the knowledge of the trust by the beneficiary may prevent them from conducting a productive lifestyle."

SB 163 allows the settlor (creator of a trust) the option to exempt the trustee, in writing, from notifying a beneficiary of his right to the proceeds of the trust. This limit on notification would only last for the life of the settlor or until he or she were judicially determined to be incapacitated. However, if a settlor provides a written waiver of notification to the trustee, the beneficiary would not be notified following the settlor's death until they were eligible to receive the proceeds of the trust.

"By allowing a settlor to delay notification to a beneficiary, we have allowed Alaskan financial institutions the same flexibility as those in other states that are competing with Alaska for trust business," said Taylor.

This legislation also defines a "current beneficiary" as a person who receives a mandatory distribution of income or principal from a trust. At this time the law does not define a "current beneficiary."

SB 163 moves to the House for consideration.

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