Only seventeen states in the United States of America permit self-settled trusts or what is more commonly known as an Asset Protection Trust (APT). A trust can claim residence (the legal term is “situs”) in any state as long as it follows the rules of that state. So when a client of any state is forming an APT they should and often do wonder: “Which state should I use for my trust?”
As a Nevada licensed attorney practicing in the fields of trust and tax planning, nothing I can say or do will ever prevent the suspicion of bias when I answer that Nevada is the best state for an APT. Fortunately I don’t need my clients to rely on my answer as the reasons behind my answer are plain, simple, and obvious. They are:
Nevada’s trust laws and legislature are genuine. When they say they will protect your assets, they mean it. Nearly every other state offers certain creditors rights to the APT, which reeks of contradiction and uncertainty. Nevada, on the other hand, protects the APT from every creditor. No exception.
This conviction bleeds into the Nevada Supreme Court where the Nevada APT was recently tested and won. In a significant 2017 decision, the Nevada Supreme Court heard argument from a spousal-creditor seeking access to the APT’s assets and ruled in favor of the APT and the spousal-debtor. Where so many other states have seen their judges grant creditors exceptions, Nevada’s court does not.
Nevada’s statutes are artfully crafted to permit flexibility. So many states hide behind verbose and regimented code sections that handcuff settlors, beneficiaries, and trustees. Nevada’s statutes are largely written by wise, experienced attorneys practicing in the field. These authors live and breathe the needs, requests, and wishes of their clients. Every good practitioner knows no two clients are identical and circumstances change. The Nevada statutes provide unparalleled flexibility in the initial drafting and the most progressive decanting statutes to permit modification after implementation.
Nevada wants your business and wants that business to continue. A trust formed in the State of Nevada can exist for three hundred and sixty-five years. Most other states have a significantly shorter time limit. For those looking to benefit their family for generations to come, this benefit is a necessity. And, once again, this statute has been tested by the Supreme Court of Nevada and survived.
To provide high-end trust options to clients from other jurisdictions, Nevada needs well established and secure trust companies. Nevada monitors and regulates these companies to ensure that they are well capitalized, stable, and following proper accounting and confidentiality practices. Moreover, because Nevada is a highly desired trust destination, competition amongst the trust companies drives trustee fees down.
Additionally, it is far more palatable for a client to use a jurisdiction that’s easy to get to than one that is remote; and more palatable when the location has a long history of visitors, travelers, and legal benefits. Las Vegas, Nevada is an internationally recognized vacation destination, a world-renowned center of entertainment, dining, and shopping. Its airport is one of the busiest in the country with regular direct flights to every other major airport. Delaware doesn’t even have a major airport.
Strong legal community (lawyers and judges know each other, law school)
Finally, Nevada is a retirement destination. Its not uncommon for the non-Nevadan client to end up here anyway, just like so many others.”
To find out more about migrating your business to Nevada, contact us at 951-788-9410.