(a)

(1) Due to the potential conflict of interest that exists between a trustee who is a beneficiary and other beneficiaries of the trust, any power conferred upon a trustee, other than the settlor of a revocable or amendable trust:

(A) To make discretionary distributions of either principal or income to or for the benefit of the trustee, except to provide for that trustee's health, education, maintenance, or support as described under Internal Revenue Code §§ 2041 and 2514 (26 U.S.C. §§  2401 and 2514);

(B) To make discretionary allocations of receipts or expenses as between principal and income, unless the trustee acts in a fiduciary capacity whereby the trustee has no power to enlarge or shift any beneficial interest except as an incidental consequence of the discharge of the trustee's fiduciary duties;

(C) To make discretionary distributions of either principal or income to satisfy any legal support obligations of the trustee; or

(D) To exercise any other power, including the right to remove or to replace any trustee, so as to cause the powers enumerated in subdivision (a)(1)(A), (B) or (C) to be exercised on behalf of, or for the benefit of, a beneficiary who is also a trustee,

(2) Any of the foregoing proscribed powers that are conferred upon two (2) or more trustees may be exercised by the trustees who are not so disqualified. If there is no trustee qualified to exercise the power and the document creating the trust does not include authority for the appointment of an independent trustee, any party in interest, as defined in subsection (c), may apply to a court of competent jurisdiction to appoint an independent trustee and the power may be exercised by the independent trustee appointed by the court.

(b) This section applies to any trust unless application of the statute would cause the loss of a marital or charitable deduction or loss of generation skipping transfer tax exemption or the terms of the trust either:

(1) Refer specifically to this section and provide expressly to the contrary;

(2) Clearly indicate an intent by the settlor of the trust or testator of a will to grant the trustee who is also a beneficiary the power in question to accomplish a particular beneficial tax result; or

(3) Contain language similarly limiting the powers of a trustee who is also a beneficiary.

(c) For the purpose of subsection (a) or (b):

(1) If the trust is revocable or amendable and the settlor is not incapacitated, the party in interest is the settlor.

(2) If the trust is revocable or amendable and the settlor is incapacitated, the party in interest is the settlor's legal representative under applicable law or the settlor's donee under the durable power of attorney that is sufficient to grant such authority.

(3) If the trust is not revocable or amendable, the parties in interest are:

(A) Each trustee then serving;

(B) Each income beneficiary then in existence or, if any such beneficiary has not attained majority or is otherwise incapacitated, the beneficiary's natural guardian or other legal representative under applicable law or the beneficiary's donee under a durable power of attorney that is sufficient to grant such authority; and

(C) Each remainder beneficiary then in existence or, if any such remainder beneficiary has not attained majority or is otherwise incapacitated, the beneficiary's natural guardian or other legal representative under applicable law or the beneficiary's donee under a durable power of attorney that is sufficient to grant such authority.

(d) A person who has the right to remove or replace a trustee does not possess nor may that person be deemed to possess, by virtue of having that right, the powers of the trustee that is subject to removal or to replacement.