The majority of trust documents include a spendthrift provision. This is a written provision in the trust that prohibits a trust beneficiary form anticipating or assigning or transferring a future interest in the trust. In other words, the beneficiary cannot bank on the fact that he will or may get distributions from the trust in the future. These clauses may restrict both voluntary and involuntary transfers and don’t work for one’s own individual benefit.
O.C.G.A. § 53-12-28 Spendthrift
- A spendthrift provision is a provision in a trust that the interest of the beneficiary in the income or in the principal or in both may not be voluntarily or involuntarily transferred before payment or delivery of the interest to the beneficiary by the trustee.
- A spendthrift provision prohibiting voluntary transfers is valid and enforceable.
- Except as otherwise provided in this subsection, a spendthrift provision prohibiting involuntary transfers is valid and enforceable. Except with regard to a community trust established pursuant to Chapter 10 of Title 30, a spendthrift provision prohibiting involuntary transfers is not valid if the beneficiary is the settlor. A spendthrift provision prohibiting involuntary transfers is not valid as to the following claims against a distribution to a beneficiary, other than a beneficiary who has a medically determined physical or mental disability that substantially impairs the beneficiary’s ability to provide for the beneficiary’s care or custody and constitutes a substantial handicap or in the case of a life beneficiary of a community trust, to the extent the distribution would be subject to garnishment under the laws of this state if the distribution were disposable earnings:
- Tort judgments;
- Taxes;
- Governmental claims;
- Alimony;
- Child support; or
- Judgment for necessaries not voluntarily provided by the claimant.
- Notwithstanding any other provision in this Code section to the contrary, a spendthrift provision in a bona fide pension or retirement trust is valid and enforceable with reference to the entire interest of the beneficiary in the income or in the principal or in both, even if the beneficiary is also the settlor of the trust, except where a claim is made pursuant to a qualified domestic relations order as defined in 26 U.S.C. Section 414(p), or any subsequent statute of similar import.