(a) Broad power of appointment.--Subject to subsection (c), in the absence of a contrary intent appearing in the instrument creating a broad power of appointment or in the donee's instrument exercising the power, a broad power of appointment may be exercised only by the donee's instrument making:
(1) specific reference to the power;
(2) general reference to any or all powers of appointment held by the donee;
(3) a testamentary or inter vivos gift specifically describing the appointive property;
(4) an insufficiently funded testamentary pecuniary legacy, to the extent to satisfy the legacy;
(5) a general testamentary gift; or
(6) a testamentary residuary gift.
(b) Limited power of appointment.--
(1) Subject to paragraph (2) and subsection (c), in the absence of a contrary intent appearing in the instrument creating a limited power of appointment or in the donee's instrument exercising the power, a limited power of appointment may be exercised only by the donee's instrument making:
(i) specific reference to the power;
(ii) a testamentary or inter vivos gift specifically describing the appointive property;
(iii) a general testamentary gift to all, and only to all, the objects of the power; or
(iv) a testamentary residuary gift to all, and only to all, the objects of the power.
(2) The objects of the power described in paragraph (1)(iii) and (iv) who have a common ancestor shall be only those descendants of the common ancestor determined on a per stirpes basis.
(c) Necessity of donee's specific reference to power.--A power of appointment may be exercised only by specific reference to the power if the instrument creating the power so requires.
(d) Exercise before testamentary power granted.--In the absence of a contrary intent appearing in the instrument creating a power of appointment exercisable at the donee's death or in the donee's instrument exercising the power, the donee's instrument may exercise a power of appointment existing at the donee's death even though the power was granted after the date of the donee's instrument.
(e) Testamentary powers.--
(1) Notwithstanding any contrary provision in an instrument creating a power of appointment, a testamentary power of appointment shall not be exercisable in favor of the donee or the donee's creditors.
(2) A grant of a testamentary power to appoint to the donee's creditors shall be construed as a power to appoint to the creditors of the donee's estate. In the absence of a specific contrary intent appearing in the instrument, the grant of a testamentary power that denies the right to appoint to the donee's creditors shall be construed as also denying the power to appoint to the creditors of the donee's estate.
(3) An attempted exercise of a testamentary power of appointment in favor of the donee's creditors shall be construed as an exercise in favor of those creditors of the donee's estate who were also creditors of the donee at the time of the donee's death.
(4) If the donee is an issue of the donor, a testamentary power of appointment to appoint to the donor's issue shall not be exercisable in favor of the donee or the donee's estate.
