New Mexico § 45-2A-7 - Trust for spouse and issue

§ 45-2A-7. Trust for spouse and issue

A. Property held in trust under Subparagraph (c) of Paragraph (2) of Subsection A

of Section 6 is held upon the terms of Subsections B through D of this section. B. During the life of the surviving spouse, the entire net income must be paid to

or for the benefit of the surviving spouse in quarterly or more frequent installments;

net income accrued or undistributed on the death of the surviving spouse must be paid

to the estate of the spouse; if unproductive property is held in the trust, the surviving

spouse at any time by written instrument delivered to the trustee may compel conversion

of the unproductive property to productive property. C. During the life of the surviving spouse, the trustee at any time may pay to or

for the benefit of the surviving spouse and issue of the testator amounts of the principal

the trustee deems advisable, giving reasonable consideration to other resources available

to the distributee, for the individual's needs for health, education, support or maintenance;

for the purpose of making those discretionary payments, the principal must be administered

as two separate shares, which at the inception of the trust must be equal; one share

is the surviving spouse's share of the principal; during the life of the surviving

spouse, payments may not be made from the surviving spouse's share to anyone other

than the surviving spouse; primary consideration must be given to the needs of the

surviving spouse and the children of the testator who are under the age of twenty-three

years or under disability. The trustee may rely in good faith on a written statement furnished by a beneficiary. The discretion to pay principal to or for the benefit of any individual includes

the discretion after that individual's death to pay expenses incurred before the individual's

death and to pay funeral and burial expenses. If the trustee, other than the surviving spouse, determines that continuation of

the trust is uneconomical, the trustee may terminate the trust by distribution of

principal to the surviving spouse. Principal that in the exercise of the trustee's discretion is paid to or for the

benefit of any issue may be charged against any share of income or principal thereafter

existing for that issue or for any ancestor or descendant of that issue if the trustee

upon equitable considerations so determines. If the surviving spouse or any issue is serving as trustee, the trustee's discretion

pursuant to this subsection is not exercisable in favor of that trustee except as

necessary for the trustee's needs for health, education, support or maintenance, nor

is the trustee's discretion exercisable in favor of the trustee's estate, the trustee's

creditors or creditors of the trustee's estate. D. On the death of the surviving spouse, the principal, unless retained in trust under Section 9 or 10 of the Uniform Statutory Will Act , must be paid, subject to any charges made by the trustee under Subsection C of this

section, to the children of the testator in equal shares if all of the children are

then living, otherwise to the then living issue of the testator by representation

or, if no issue of the testator is then living, to the individuals who would be entitled

to receive the estate as if the property were located in this state and the testator

had then died intestate domiciled in this state in proportions determined under the

law then existing.