Why Nevada?
Select Advantages of a Nevada-Based Trust
1. Lack of State Income Tax
Unlike most states, Nevada does not have state income tax. As a result, a Nevada-based trust is only subject to federal income tax and can benefit from tax savings that may not be offered in other states.
2. Lack of Inheritance Tax
The State of Nevada does not levy an inheritance tax on beneficiaries of an estate after a decedent’s death. Funds not deducted during the probate process can be invested or utilized to pay federal estate taxes.
3. Shortest Statute of Limitations
The statute of limitations, also known as the “seasoning period”, is the period of time between when assets are transferred into a trust until the assets held within the trust are legally protected from creditors and fraudulent transfers. Nevada’s seasoning period of 2 years is one of the shortest in the U.S.
4. No Exception Creditors Protection
After the seasoning period of 2 years, assets held in Nevada-based trusts are protected from claims arising from exception creditors (e.g., divorcing spouse, child support, etc.). Nevada is one of the few states that provides this benefit.
5. 365-Year Term
A trust created in Nevada, often known as a Dynasty Trust, can have a term lasting 365 years. With a Dynasty Trust, assets held are subject to an initial estate transfer tax only which allows subsequent generations to benefit from bypassing future transfer taxes.
6. Favorable Privacy Rules
In general, Nevada-based trusts are filed with the Clark County Recorder’s Office. The choice of whether to record a trust or not is left to the trust’s creator. Nevada offers favorable privacy laws that do not require recording or registration of trusts for public records purposes, a benefit popular with many trust creators to maintain privacy.
Select Advantages of a Nevada-Based Trust
1. Lack of State Income Tax
Unlike most states, Nevada does not have state income tax. As a result, a Nevada-based trust is only subject to federal income tax and can benefit from tax savings that may not be offered in other states.
2. Lack of Inheritance Tax
The State of Nevada does not levy an inheritance tax to beneficiaries of an estate after a decedent’s death. The funds not deducted during the probate process can be invested or utilized to pay for federal estate taxes.
3. Shortest Statute of Limitations
The statute of limitations, also known as the “seasoning period”, is the period of time between when assets are transferred into a trust to when the assets held within that trust are legally protected from creditors and fraudulent transfers. Nevada’s seasoning period of 2 years is one of the shortest in the U.S.
4. No Exception Creditors Protection
After the seasoning period of 2 years, assets held in Nevada-based trusts are protected from claims arising from exception creditors (e.g., divorcing spouse, child support, etc.). Nevada is one of the few states that provides this benefit.
5. 365-Year Term
A trust created in Nevada, often known as a Dynasty Trust, can have a term of up to 365 years. With a Dynasty Trust, assets held are subject to an initial estate transfer tax only which allows subsequent generations the benefit of bypassing future transfer taxes.
6. Favorable Privacy Rules
In general, Nevada-based trusts are filed with the Clark County Recorder’s Office. The choice of whether to record a trust or not is left to the trust’s creator. Nevada offers favorable privacy laws that does not require the recording or registration of trusts for public records purposes, a benefit popular with many trust creators in order to maintain privacy
