Dynasty Trust: What Is It And What Are The Benefits?
A Dynasty Trust is a way to pass your wealth from generation to generation while protecting your hard-earned assets from creditors and other parties. People who set up a Dynasty Trust can pass assets hundreds of years into the future to ensure that their grandchildren and great-grandchildren become the beneficiaries long after the Trustor is gone.
One of the greatest benefits of setting up a Dynasty Trust is that it allows you to ensure that multiple generations inherit your assets without incurring transfer taxes.
Creating a Dynasty Trust requires a lot of planning and legal expertise. That is why you should contact a St. Petersburg estate planning lawyer to help you set up a Dynasty Trust and ensure that you can protect and preserve your wealth for multiple generations.
How to Set Up a Dynasty Trust in Florida?
You can set up a Dynasty Trust by executing a Declaration Of Trust and then transferring your assets into the Trust. In Florida, a Dynasty Trust can be testamentary or inter vivos:
- A testamentary Trust is established upon the decedent’s death as long as their Last Will and Testament instructed the personal representative of the estate to create a Trust; and
- Inter vivos Trusts are created when an individual is still alive.
However, in order to remove assets from your taxable estate, you need to set up a Dynasty Trust as inter vivos and irrevocable when transferring assets into the Trust. When appointing a Trustee of your Dynasty Trust, your Declaration should also define the location where the Trust will be administered and the governing law.
Unlike other states, Florida has a 360-year rule, which means a Dynasty Trust can last up to 360 years. You can fund your Dynasty Trust with valuable assets such as real estate, securities, investments, stocks, and cash.
What Are the Benefits of Creating a Dynasty Trust?
There are many benefits associated with creating a Dynasty Trust. Some of the biggest advantages of a Dynasty Trust include:
- Fund your Dynasty Trust with any valuable assets. You can transfer any valuable assets into a Dynasty Trust, including but not limited to securities, real estate, stocks, and others.
- Protect assets from transfer and estate taxes. With a Dynasty Trust, you can transfer your assets from generation to generation without incurring transfer and estate taxes.
- Preserve your wealth for up to 360 years. A well-structured Dynasty Trust will last up to 360 years. Because of the length, the Trustor can appoint successor Trustees to handle the administration of the Trust for decades to come.
- Protect assets from bankruptcy and divorce. If your child or grandchild files for divorce or declares bankruptcy, the assets held in the Dynasty Trust will not be accessible to the child’s spouse or creditors.
- Control the distributions. A Trustor can decide how their assets will be distributed, when they will be distributed, and in what amounts.
- Make direct distributions. You have the option of making direct distributions to your beneficiaries in future generations.
If you are considering creating a Dynasty Trust, get a case review with a knowledgeable estate planning lawyer. Our attorneys at Legacy Protection Lawyers, LLP, are prepared to help. Call 727-471-5868 to discuss your options.