What You Need to Know About Nevada Asset Protection Trusts
Nevada Asset Protection Trust is a popular estate planning solution that helps shield assets from potential creditors. Learn more here!
What Is an Asset Protection Trust in Nevada?
An asset protection trust (APT) is an irrevocable trust frequently created to protect an individual or business from the harmful effects of transfer taxes, divorce settlements, bankruptcy laws, or any other creditors.
This estate planning instrument, also known as a self-settled spendthrift trust, essentially allows people and businesses to create a trust that makes it difficult for creditors to access estates in a trust.
For Nevada asset protection trusts, at least one trustee must be a Nevada resident, a Nevada institution, or a trust company for the trust to be legal according to Nevada law. This means that anyone, including people who do not reside in Nevada, can establish an asset protection trust in Nevada.
In addition to providing asset protection, a domestic asset protection trust has additional benefits, such as reducing state income taxes when it is located in a no-income-tax state such as Nevada.
If you are interested in asset protection, ensure that you consider all your options and devise a strategy that may suit you and your family.
How Does an Asset Protection Trust Work?
APTs are self-settled trusts where the founder can be named a beneficiary and access the trust funds.
APTs must meet strict regulatory standards, such as being irreversible. An independent trustee can make payouts periodically, but only at their discretion.
Also, these trusts have a spendthrift clause which prohibits the beneficiary from selling, spending or giving away any trust assets without meeting certain conditions.
Whenever a beneficiary attempts or is forced to transfer a spendthrift trust’s assets, the trustee must reject and stop any transfer or conduct contrary to the Nevada Spendthrift Trust Act.
How Can a Spendthrift Trust Protect My Assets?
Self-settled spendthrift trusts work in the beneficiary’s interest. They require a trustee to pay for the care and maintenance of a beneficiary and prevent the beneficiary from voluntarily or involuntarily transferring trust property.
All the beneficiaries own an equitable share in the trust assets. Still, they do not have any legal title to any of them.
Beneficiaries cannot force the trustee to transfer property, so a trustee cannot be compelled to transfer the property to the beneficiary’s creditors. This protects the estate.
Consult with an estate planning attorney if you wish to protect your assets and secure your family’s financial future.
The Advantages of Asset Protection in Nevada
The advantages of spendthrift trusts in Nevada are the following:
Self-settled trust assets are not accessible to creditors if the trust is established correctly under Nevada laws. These assets are not the real or personal property of a beneficiary.
Most states require three or four years to create these trusts, but in Nevada, the statute of limitations is only twenty-four months for the transfer of assets.
Unlike most states, Nevada does not tax the income of trusts.
Nevada allows for directed trusts, which enable the founder to name an independent financial advisor to manage the trust’s funds.
In Nevada, there are no zero-exception creditors, including divorcing spouses.
Last but not least, the Nevada legislature is constantly improving its laws in this area.
Forms of Asset Protection Techniques in Nevada
In estate planning, conserving and protecting one’s wealth is crucial since most people have presumably accumulated that money throughout their lives.
Asset protection measures are being used more frequently to halt the stream of damaging litigation and creditors’ demands.
Common asset protection techniques are revocable trusts, irrevocable trusts, donations, homestead exemptions, limited family partnerships, limited liability corporations, off-shore trusts, and Nevada on-shore trusts.
What are the Requirements for an Asset Protection Trust According to Nevada Law?
For protection from creditors, a self-settled spendthrift trust in Nevada must:
be in writing
not require distributions of income or principal to be made to the founder
not be intended to obstruct, delay or defraud any known creditor
have at least one trustee who is a Nevada resident or a bank or a trust company that has its office in Nevada
Who Can Establish a Spendthrift Trust in Nevada?
Nevada laws allow anyone who is competent to execute a will to create a trust for asset protection.
Protecting your assets is critical regardless of your net worth, what you do for a living, or your estate planning objectives.
Usually, individuals in high-risk professions establish these trusts. These include independent contractors, company owners, and professional service providers, like physicians, dentists, attorneys, accountants, engineers, architects, and insurance brokers.
Generally, anybody who is worried that accidental or tragic events could jeopardize their hard-earned assets should consider creating an APT.
Through thorough and effective estate planning and asset protection methods, we at Wood Law Group can assist in guaranteeing your financial security and give assurance for the future.
To learn more, don’t hesitate to get in touch with us to set up a free consultation.
Asset Protection Trust Attorney in Nevada
Nevada is one of just a few states to have adopted domestic asset protection trusts. It has various asset protection options that are not available in other states. Domestic asset protection trusts are legal in 17 states in the United States.
Nevada asset protection trust regulations offer some of the most comprehensive domestic asset protection available.
Can Wood Law Group Help Me Protect My Assets?
As your Nevada asset protection planning attorneys, we can assist you in establishing an asset protection trust in Nevada and determining who to appoint as a trustee.
Our practice areas include:
- Revocable and irrevocable trusts
- Estate plans
- Advance directives
- Guardianships and conservatorships
- Elder law
Contact a probate and estate planning lawyer today at (702) 388-1711 for your free consultation or chat with us online.
Is It Costly to Create a Spendthrift Trust in Nevada?
Aside from attorneys fees, Nevada bank charges, and the trust registration fees for transferring assets into the trust, some assets might require fees for changing the name on the title deed, registration, or license.
Also, some trustees charge a percentage of the trust’s assets. These amounts are not definite and may change from year to year.
The Importance of Asset Protection Planning
Estate planning and protection have dated back centuries. Traditionally, wealthy families have used these trusts to protect assets and manage their wealth. They pass it along to their children without fear of losing it because of lawsuits, divorces, or high taxes.
Many people’s assets are held in a trust to safeguard their homes, businesses, retirement nest eggs, or children’s tuition funds.
With several years of legal experience in establishing trusts, the Wood Law Group can help you plan your estate.
Get the help of an estate planning attorney to secure your assets. Contact our law office at (702) 388-1711 for a free consultation on your case.