About half a dozen states are actively vying to attract wealthy families' trusts, as well as the jobs and tax revenue that come from the companies that administer these estate-planning vehicles.
States such as Alaska, Delaware, Nevada, New Hampshire, South Dakota and Wyoming have modified their trust laws in recent years to make them more attractive to individuals and families, including nonresidents, looking to minimize taxes, shield assets from creditors and preserve family assets in the event of a divorce, among other things.
This article, which includes comments from esteemed colleague Mark Merric, talks about States that are altering traditional trust rules to allow individuals to do exotic estate planning without taking their assets to an exotic foreign country. Twelve States now allow a person to create a "self-settled spendthrift trusts," which prevents creditors from touching assets held for the benefit of the creator of the trust. Most of those same States have also made it possible for private trusts (as opposed to charitable trusts) to last several hundred years or more, which enables families to accumulate and protect vast wealth. These strategies are most often employed by clients with multi-million dollar estates, but they can sometimes also be appropriate for folks of more modest means.