Wyoming Asset Protection Trust Guide

A Wyoming asset protection trust is a self-settled “qualified spendthrift trust” that, if properly drafted and funded before a claim arises, can shield the settlor’s assets from most future creditors while the settlor remains a discretionary beneficiary.

Wyoming law requires the trust to be irrevocable, include a spendthrift clause, and opt into Wyoming law for validity, construction, and administration.

How it works

The trust must have at least one “qualified trustee” in Wyoming—either a Wyoming resident individual or a regulated Wyoming trust company—and that Wyoming trustee must materially administer the trust in the state.

The settlor cannot serve as a qualified trustee but may retain certain powers without defeating protection, such as a veto over distributions, a limited power of appointment, the ability to replace fiduciaries, or to serve as an investment advisor.

Key requirements at a glance

• Irrevocable trust instrument that expressly states it is a Wyoming qualified spendthrift trust and applies Wyoming law.
• Spendthrift provision restricting transfer of the settlor’s beneficial interest.
• At least one qualified Wyoming trustee who materially participates in administration.
• Funding by “qualified transfer,” documented with a sworn affidavit of solvency and other statements.
• Personal liability insurance maintained by the settlor in the lesser amount of $1,000,000 or total qualified transfers.
• Exception creditors still apply: courts may attach distributions for child support or maintenance (alimony).

Creditor time bars

Wyoming routes attacks on qualified transfers through its fraudulent transfer statute and tightens the limitations. For most claims under Wyoming’s UFTA, the period is generally two years from transfer or six months from discovery.

Wyoming adds a notice shortcut for transfers into qualified spendthrift trusts: if a known creditor is mailed statutory notice, that creditor must sue within 120 days; unknown creditors have 120 days after publication.

If a creditor had a specific claim on file before transfer, they may have the later of two years from transfer or six months from discovery.

Enforcement posture

Wyoming requires that enforcement of out-of-state judgments against a Wyoming trust be filtered through a Wyoming court to ensure consistency with Wyoming’s protections and the trust’s terms.

This provision limits direct enforcement elsewhere against the trustee or trust assets.

Wyoming also elevates the burden for actions against trustees, protectors, advisors, or the professionals involved—creditors must prove a fraudulent transfer by clear and convincing evidence to reach those targets; avoidance of a transfer remains governed by the fraudulent transfer statute.

Bankruptcy overlay

Federal bankruptcy law can reach transfers to self-settled trusts made within 10 years before filing if there was actual intent to hinder, delay, or defraud; this federal look-back applies regardless of state limitation periods.

Planning must account for that federal risk window.

What can (and cannot) be protected

A Wyoming trust can hold virtually any property interest, including financial accounts and entity interests, so long as transfers comply with the statute.

Courts can still reach current or future distributions for child support or maintenance, and fraudulent transfers remain vulnerable within the statutory windows.

Practical drafting and administration

In our experience, the best results come from keeping real property outside non-Wyoming jurisdictions in entities owned by the trust and ensuring real administration occurs in Wyoming to support situs.

Our clients typically place brokerage accounts, cash, and LLC or LP interests into the trust and keep meticulous records aligning with the qualified trustee’s Wyoming administration.

Planner’s cautions

Domestic asset protection trusts face conflict-of-laws headwinds when creditors proceed in non-DAPT states, and courts will not honor transfers made with fraudulent intent.