Nevada Is One Of The Few Jurisdictions That Allows Domestic Asset Protection Trusts
Any U.S. citizen should have an asset protection strategy. With a good plan you can protect your estate from creditors. You can create a strategy with the help of an asset protection company and each plan is different depending on your circumstances. Revocable trusts don't have the power to shield you from creditors. If you create one, you still have to power to revoke it and this means that you are liable.
The best onshore protection can be achieved with an irrevocable Nevada asset protection trust. It can offer many benefits, including asset protection. These types of trusts can't be revoked or changed after their creation. The best way to create an irrevocable trust is by doing it offshore or in Nevada. In the last decades, people used offshore trusts in order to protect their assets, in jurisdictions that allow these kinds of trusts: Cayman Islands, Belize or the Island of Man. Because these trusts can be expensive, an alternative has appeared onshore. The Nevada asset protection trust has appeared recently and since 1999 the state of Nevada allows the creation of self-settled spendthrift trusts. This means that the grantor can also be the beneficiary.
There are a few conditions that have to be met in order for the Nevada asset protection trust to work. The trustee must be a resident of Nevada or an entity located in this state that is allowed to act as a trustee. The trust documents must be in writing, it has to be irrevocable and distributions are not allowed to the grantor. Also, creditors that prove that transfers to the Nevada asset protection trust were made with fraudulent intent can reach the assets from the trust.
After the Nevada asset protection trust has been created, the assets are not completely safe. Existing creditors at the time of the creation benefit from a 2 years period in which they can attack the trust and if they manage to prove that you transferred the assets with fraudulent intent they can get a hold of your assets. If the 2 years period passes without any attack, your assets are safe.
There are only a few states that have a jurisdiction like that from Nevada. If you have a Nevada asset protection trust a part of the property transferred in the trust must be located in Nevada, the grantor must be a resident of Nevada and the management of the assets must be coordinated by an independent Nevada trustee. The best way to assure that you respect these conditions is by being a Nevada resident. If you have a Nevada asset protection trust you can transfer your stocks, bonds and real estate property into the trust, shielding them from creditors.
Using a Nevada asset protection trust properly can help you protect any type of asset and you only need to be careful at some laws that apply to these trusts. A Nevada asset protection trust can be helpful for those who have jobs that make them liable. If you have assets that need to be protected against lawsuits the cheapest and safest way to do it is with the creation of a Nevada asset protection trust.
Back to Articles...