States with domestic asset protection trusts

Domestic Asset Protection Trusts (DAPTs) are a form of trust designed to help individuals protect their assets from creditors. Not all states in the U.S. allow for the creation of DAPTs. The states that offer Domestic Asset Protection Trusts have specific statutes that permit these kinds of trusts, often with varying degrees of protection and differing requirements. Here’s a list of states that are known for offering domestic asset protection trusts:

  1. Alaska
  2. Delaware
  3. Nevada
  4. South Dakota
  5. Wyoming
  6. Rhode Island
  7. Utah
  8. New Hampshire
  9. Ohio
  10. Missouri
  11. Tennessee
  12. Mississippi
  13. Oklahoma
  14. Virginia
  15. West Virginia
  16. Hawaii
  17. Michigan
  18. South Carolina

The laws and effectiveness of DAPTs can vary significantly from state to state. Some states offer stronger asset protection features than others. The choice of state for establishing a DAPT can depend on several factors, including the specific asset protection laws in that state, the residency of the settlor (the person who creates the trust), and the type of assets being protected.

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Do Domestic Asset Protection Trusts Work Well in Florida?

Regarding trusts, Florida law does not provide the same level of asset protection as states with specific DAPT statutes, such as Nevada, Alaska, or Delaware.

Instead, individuals in Florida often use other asset protection strategies. For instance, they might use statutory exemptions and establish entities like limited liability companies or limited partnerships for business assets. Forming a domestic asset protection trust in another state does not usually work well because Florida courts usually apply Florida collection law against a Florida resident’s interest in an out-of-state trust.

Gideon Alper

About the Author

I’m an attorney who specializes in asset protection planning. I graduated with honors from Emory University Law School and have been practicing law for almost 15 years.

I have helped thousands of clients protect their assets from creditors. Before private practice, I represented the federal government while working for the IRS Office of Chief Counsel.

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