DYNASTY TRUSTS

At Dilendorf Law Firm, our Asset Protection specialists are well-versed in the various trust and estate planning options designed to safeguard your assets. A dynasty trust, also known as a perpetual trust, offers a way of passing wealth on to future generations while minimizing gift and estate taxes. Like other funds, dynasty trusts involve a grantor who transfers the assets, a trustee who manages the fund, and beneficiaries who receive distributions.

What makes a Dynasty Trust unique?

The biggest difference between a dynasty trust and other trusts is their longevity, meaning they can last for several generations, or even centuries, depending on the state where they are administered. Most other trusts end no later than 21 years after the death of one of the involved parties. States where irrevocable dynasty trusts are available have enacted perpetuity reforms that allow these trusts to last longer, but not every state’s trust has the same duration. Be sure to talk with a planning attorney to determine if a dynasty trust is right for you.

Dynasty trusts are irrevocable, meaning the grantor has no control over the assets once they are transferred into the fund. However, the grantor may opt to specify the way in which the trust is managed, including how distributions will be made and what kind of control the trustee will have. A grantor in a dynasty trust may also specify the amount of flexibility beneficiaries should have in managing assets and provide stipulations on how future generations should benefit from the funds.

Who should have a dynasty trust?

Under normal circumstances, the flow of an estate from parents to children would be subject to estate or gift taxes, and in some cases, a generation-skipping transfer tax (GSTT). Because the dynasty trust is irrevocable, once the assets are in the fund, they will not be subject to certain taxable events, making them a great way to save money on taxes.

It is important to work with experts who can help you take advantage of these savings, and time a trust to take advantage of short-term tax savings opportunities. Certain tax benefits, such as the higher exemption levels afforded by recent legislation, are set to expire in 2025, making it even more important to shelter these assets now.

Considerations before creating a dynasty trust

Consult with a qualified attorney: Since the dynasty trust involves a complex set of guidelines for future generations, as well as federal and state tax planning, it is a good idea to consult with an attorney.

Name your beneficiaries and trustees: Careful consideration must be given to the selection of a trustee for a dynasty trust, as different states will have varying laws, depending on the type of assets and desired terms.  An estate attorney will know which state best matches your objectives for the fund.

Determine the beneficiaries: Several factors must be considered when selecting beneficiaries in a dynasty trust, so that the trust will continue to benefit future generations while maximizing tax exemption.

Resources:

• Comparison of Dynasty Trusts in Alaska, Delaware and Ohio from the Perspective of the Ohio Practitioner
• What is Asset Protection
• Strategies to Obtain a Basis Step-Up
• When is a Trust Protector a Fiduciary?
• Dynasty Trusts
• Planning with Dynasty Trusts
• Perpetual Dynasty Trusts
• The Alaska Dynasty Trust

Summary

Service Type

Dynasty Trusts

Provider Name

Dilendorf Law Firm,

60 Broad Street, 24th Floor,New York,New York-10004,
Telephone No.212.457.9797

Area

Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming

Description

At Dilendorf Law Firm, our Asset Protection specialists are well-versed in the various trust and estate planning options designed to safeguard your assets. A dynasty trust, also known as a perpetual trust, offers a way of passing wealth on to future generations while minimizing gift and estate taxes. Like other funds, dynasty trusts involve a grantor who transfers the assets, a trustee who manages the fund, and beneficiaries who receive distributions.