According to a recent survey, Nevada leads every other state in the nation as the ideal state for creating a trust account
. The top choice of 64% of the 150,000 participants, it was ahead of the next-best domicile for trusts, Alaska, by a margin of two to one.
Over 70% of U.S. households with a net worth greater than $1 million use trusts, a percentage of that includes many middle-class homeowners. One need not live in Nevada to benefit from of its advantageous legal treatment of trusts. While states such as Delaware and South Dakota also offer a favorable tax and regulatory climate, Nevada's laws make it an appealing choice when trying to protect one's nest egg and pass it on to future generations.
The lack of a state income tax in Nevada helps. Trust income isn't taxed at the state level. If you live outside Nevada, however, distributions from the trust may be taxed by your state.
Nevada's dynastic trust rules are also beneficial. The state allows "dynasty trusts" to last for 365 years, spanning many generations. This can prove valuable when structuring generation skipping trusts.
Nevada also has laws that protect assets from lawsuits and creditors. It has a short statute of limitations for so-called "fraudulent transfers" to asset protection trusts. While not necessarily fraudulent as the term is colloquially understood, some transfers may be disallowed by a court if they occur too near in time to an action by a creditor. Nevada's short waiting period—a mere six months from the date of reasonable discovery and two years from asset transfer date—can reduce risk and uncertainty.
A form of Nevada-based trust known as a Nevada Asset Protection Trust or NAPT may also be an effective tool for wealthy individuals seeking to preserve assets.
An experienced attorney can help you decide whether Nevada's trust laws should be part of your estate plan and what steps you should take to make the most of them. Every financial situation is unique and you should explore all of your options with a qualified attorney. Call Las Vegas, Nevada estate planning
attorney Craig Stone at (877) 905-0890 for a consultation today.