163.4185 - Classifications of distribution interests. - Nevada Statutes

163.4185  Classifications of distribution interests.

      1.  A distribution interest may be classified as:

      (a) A mandatory interest if the trustee has no discretion to determine whether a distribution should be made, when a distribution should be made or the amount of the distribution.

      (b) A support interest if the distribution of a support interest contains a standard for distribution for the support of a person which may be interpreted by the trustee or a court, as necessary. A provision in a trust which provides a support interest may contain mandatory language which a trustee must follow.

      (c) A discretionary interest if the trustee has discretion to determine whether a distribution should be made, when a distribution should be made and the amount of the distribution.

      2.  If a trust contains a combination of a mandatory interest, a support interest or a discretionary interest, the trust must be separated as:

      (a) A mandatory interest only to the extent of the mandatory language provided in the trust;

      (b) A support interest only to the extent of the support language provided in the trust; and

      (c) A discretionary interest for any remaining trust property.

      3.  If a trust provides for a support interest that also includes mandatory language but the mandatory language is qualified by discretionary language, the support interest must be classified and separated as a discretionary interest.

      (Added to NRS by 2009, 786)