Ch. 12: Spendthrift Trusts and Discretionary Trusts
Ch. 12: Spendthrift Trusts and Discretionary Trusts
Basic Concepts
Synopsis: Discusses the major variants of trusts in the asset protection context.
Spendthrift Trusts
Synopsis: Discussion of spendthrift trusts and certain statutory exceptions to spendthrift provisions.
Definition: Spendthrift Trusts -- A trust that includes certain language giving the trustee wide latitude to avoid making distributions to beneficiaries where the distribution would go to a creditor, or where the trustee fears the distribution would be wasted by the beneficiary.
Definition: Domestic Asset Protection Trust (DAPT) -- A self-settled spendthrift trust formed in a U.S. state that permits such forms of trust.
More information relating to spendthrift trusts, including a sample spendthrift provision and references to opinions involving spendthrift provisions, is available at http://www.assetprotectionbook.com/spendthrift_trusts.htm
Discretionary Trusts
Synopsis: Discusses forms of discretionary trusts.
Definition: Discretionary Trusts -- A trust that allows the trustee the discretion to make or not make distributions of benefits to the beneficiary, and to make unequal distributions among all beneficiaries.
Powers of Appointment
Synopsis: Discusses the federal gift and estate tax effect of Powers of Appointment (POA).
Dynasty Trusts
Synopsis: Discusses the benefits of Dynasty Trusts for estate planning.
Definition: Dynasty Trust -- A trust formed in a jurisdiction that has either abolished the Rule Against Perpetuities (which limits the duration of trusts) or has statutorily expanded the Rule Against Perpetuities for a period in excess of 100 years.
Beneficiary-Controlled Trusts
Synopsis: Discusses the disadvantages of Beneficiary-Controlled Trusts from an asset protection viewpoint, and possible methods of mitigating those problems.
Trusts and UFTA
Synopsis: Discusses the implications of gifting to fund trusts and the fraudulent transfer laws.
Basic Concepts
Synopsis: Discusses the major variants of trusts in the asset protection context.
Spendthrift Trusts
Synopsis: Discussion of spendthrift trusts and certain statutory exceptions to spendthrift provisions.
Definition: Spendthrift Trusts -- A trust that includes certain language giving the trustee wide latitude to avoid making distributions to beneficiaries where the distribution would go to a creditor, or where the trustee fears the distribution would be wasted by the beneficiary.
Definition: Domestic Asset Protection Trust (DAPT) -- A self-settled spendthrift trust formed in a U.S. state that permits such forms of trust.
More information relating to spendthrift trusts, including a sample spendthrift provision and references to opinions involving spendthrift provisions, is available at http://www.assetprotectionbook.com/spendthrift_trusts.htm
Discretionary Trusts
Synopsis: Discusses forms of discretionary trusts.
Definition: Discretionary Trusts -- A trust that allows the trustee the discretion to make or not make distributions of benefits to the beneficiary, and to make unequal distributions among all beneficiaries.
Powers of Appointment
Synopsis: Discusses the federal gift and estate tax effect of Powers of Appointment (POA).
Dynasty Trusts
Synopsis: Discusses the benefits of Dynasty Trusts for estate planning.
Definition: Dynasty Trust -- A trust formed in a jurisdiction that has either abolished the Rule Against Perpetuities (which limits the duration of trusts) or has statutorily expanded the Rule Against Perpetuities for a period in excess of 100 years.
Beneficiary-Controlled Trusts
Synopsis: Discusses the disadvantages of Beneficiary-Controlled Trusts from an asset protection viewpoint, and possible methods of mitigating those problems.
Trusts and UFTA
Synopsis: Discusses the implications of gifting to fund trusts and the fraudulent transfer laws.
Labels: asset protection, beneficiary-controlled trust, dapt, discretionary trust, domestic asset protection trust, dynasty trust, power of appointment, self-settled spendthrift trust
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