Estates and Trusts - Spousal Lifetime Access Trusts

HB 50 modifies Maryland's trust law to clarify when a married individual creating a trust isn't considered the "settlor" for tax purposes, specifically for trusts benefiting their spouse during the spouse's lifetime. It directly affects married Maryland residents who establish certain irrevocable trusts for their spouse's benefit, including those meeting IRS rules for "qualified terminable interest property." The key provision protects trust assets from creditors if the trust meets specific conditions: it benefits the spouse during their lifetime, is irrevocable, and allows the creator to become a beneficiary after the spouse's death through a power of appointment. This changes how these trusts are treated under state law regarding settlor status and creditor claims, effective October 1, 2025.