Nevada has no state or corporate income tax, therefore income generated from the trust is never taxed on a state level.
Nevada allows self-settled spendthrift trusts by statute, these are also known as domestic asset protection trusts or Nevada asset protection trusts.
You do not have to live in Nevada to use the Nevada asset protection trust, as long as you have a Nevada resident trustee, like Alliance Trust Company.
Nevada allows for Dynasty Trusts that can last for 365 years, skipping many generations for estate tax purposes.
Nevada has a two year statute of limitations on asset transfers to self-settled spendthrift trusts, also known as a seasoning period. This is the shortest seasoning period in all the United States. Delaware has a four year seasoning period and Alaska and South Dakota, both have three year periods.
There are no exception creditors under Nevada law, which includes claims for spousal and child support, this provision is unique to Nevada.
There is no prohibition on the settlor’s powers over the trust, with the sole exception of making distributions to him or herself.
Trusts can require a distribution to the settlor and still qualify as self-settled spendthrift trusts, using grantor retained annuity trusts, qualified personal residence trusts, charitable remainder trusts, or income-only distributions.
The settlor of a Nevada asset protection trust may serve as co-trustee and manage the assets of the trust.
The settlor can retain a limited power of appointment rendering transfers to the trust incomplete for gift tax purposes.
Fraudulent conveyance is the only attack allowed on Nevada asset protection trusts and must be proved by clear and convincing evidence as to that specific creditor.
One of the most common attacks made by creditors to reach assets is to claim “improper dominion and control” over a trust. Evidence of improper dominion and control and alter ego are not admissible according to the Nevada statutes.
Trustees may not be compelled to make discretionary distributions.
