701.1311(6)(6) If an authorized fiduciary has expanded distributive discretion over part but not all of the principal of a first trust, the fiduciary may exercise the decanting power under this section over that part of the principal over which the authorized fiduciary has expanded distributive discretion.

701.1312(1)(1) In this section, “limited distributive discretion” means a discretionary power of distribution that is limited to an ascertainable standard or a reasonably definite standard.

701.1312(2)(2) An authorized fiduciary that has limited distributive discretion over the principal of the first trust for the benefit of one or more current beneficiaries may exercise the decanting power over the principal of the first trust.

701.1312(3)(3) Under this section and subject to s. 701.1314, a 2nd trust may be created or administered under the law of any jurisdiction. Under this section, the 2nd trusts, in the aggregate, must grant each beneficiary of the first trust beneficial interests that are substantially similar to the beneficial interests of the beneficiary in the first trust.

701.1312(3m)(3m) Notwithstanding sub. (3), an authorized fiduciary exercising the decanting power under this section may grant to a beneficiary of the 2nd trust a testamentary power of appointment exercisable in favor of the creditors of the beneficiary’s estate, but only if the authorized fiduciary concludes the granting of such power will be unlikely to adversely affect the beneficial interest of the presumptive remainder beneficiaries of the first trust.

701.1312(4)(4) A power to make a distribution under a 2nd trust for the benefit of a beneficiary who is an individual is substantially similar to a power under the first trust to make a distribution directly to the beneficiary. A distribution is for the benefit of a beneficiary if any of the following applies:

701.1312(4)(b)(b) The beneficiary is under a legal disability or the trustee reasonably believes the beneficiary is incapacitated, and the distribution is made as permitted under this chapter.

701.1312(4)(c)(c) The distribution is made as permitted under the terms of the first-trust instrument and the 2nd-trust instrument for the benefit of the beneficiary.

701.1312(5)(5) If an authorized fiduciary has limited distributive discretion over part but not all of the principal of a first trust, the fiduciary may exercise the decanting power under this section over that part of the principal over which the authorized fiduciary has limited distributive discretion.

701.1313(1)(1) In this section:

701.1313(1)(a)(a) “Beneficiary with a disability” means a beneficiary of a first trust who the special-needs fiduciary believes in good faith is an individual with a disability.

701.1313(1)(b)(b) “Special-needs fiduciary” means, with respect to a trust that has a beneficiary with a disability, any of the following:

701.1313(1)(b)1.1. A trustee or other fiduciary, other than a settlor, that has discretion to distribute part or all of the principal of a first trust to one or more current beneficiaries.

701.1313(1)(b)2.2. If no trustee or fiduciary has discretion under subd. 1., a trustee or other fiduciary, other than a settlor, that has discretion to distribute part or all of the income of the first trust to one or more current beneficiaries.

701.1313(1)(b)3.3. If no trustee or fiduciary has discretion under subds. 1. and 2., a trustee or other fiduciary, other than a settlor, that is required to distribute part or all of the income or principal of the first trust to one or more current beneficiaries.

701.1313(1)(c)(c) “Special-needs trust” means a trust the trustee believes would not be considered a resource for purposes of determining whether an individual with a disability is eligible for the supplemental security income program or the medical assistance program.

701.1313(2)(2) A special-needs fiduciary may exercise the decanting power under s. 701.1311 over the principal of a first trust as if the fiduciary had authority to distribute principal to a beneficiary with a disability subject to expanded distributive discretion if all of the following apply:

701.1313(2)(a)(a) A 2nd trust is a special-needs trust that benefits the beneficiary with a disability.

701.1313(2)(b)(b) The special-needs fiduciary determines that exercise of the decanting power will further the purposes of the first trust.

701.1313(3)(3) In an exercise of the decanting power under this section, the following rules apply:

701.1313(3)(a)(a) Notwithstanding s. 701.1311 (3) (b), the interest in the 2nd trust of a beneficiary with a disability may do any of the following:

701.1313(3)(a)1.1. Be an account in a pooled trust for the benefit of the beneficiary with a disability described in 42 USC 1396p (d) (4) (C) that includes the trust retention provisions permitted by 42 USC 1396p (d) (4) (C) (iv).

701.1313(3)(a)2.2. Contain payback provisions complying with reimbursement requirements of Medicaid law under 42 USC 1396p (d) (4) (A) or (C).

701.1313(3)(b)(b) Section 701.1311 (3) (c) does not apply to the interests of the beneficiary with a disability.