Utah Asset Protection Trusts
Want to Protect Your Assets? Utah Is the Place to Be
Utah has an asset protection trust law that is one of the most effective in the country. If you are a Utah resident, a Utah asset protection trust (UAPT) can help shield you and your family from vexatious lawsuits.
Under the law, you can create and fund a Utah irrevocable asset protection trust (UAPT) with your own property, and also be both a beneficiary and a co-trustee of the trust. As long as the requirements of the statute are satisfied, you are protected from future creditors. Additionally, following statutory guidelines, assets may be creditor protected after only 120 days. The new law allows you to create a trust for the benefit of yourself and your family, to fund it with a portion of your assets, and in so doing protect your assets from future involuntary creditors. You will be a beneficiary of the trust during your lifetime, and the trust can continue for the benefit of your spouse, children and grandchildren after your death.
You can serve as a co-trustee of the trust, and can manage and invest the trust assets, as long as you do not participate in distribution decisions — that is a task left to your co-trustee who can be a spouse, family member, a trusted friend or advisor. The trust must have at least one trustee who is a Utah resident.
You can be a beneficiary of the trust, but any distributions from the trust must be made only in the trustee’s discretion.
There is no limit to how much property you can contribute to the trust. You may decide to set aside just enough for a nest egg or a safety net. Or you may choose to place a significant share of your assets in the trust. Nor are there any restrictions on what type of property you can contribute to the trust. For example, the trust can hold stocks and bonds, business interests and personal residences.
Many people seem to be under the mistaken impression that a basic revocable trust (or “Living Trust”) protects their assets from creditors. This is not true. A revocable “Living Trust” gives you no protection from creditors because it is fully revocable and amendable by you.
A Utah asset protection trust (UAPT) can be a valuable tool to protect your assets from future involuntary creditors and, if the guidelines in the statute are properly followed, you may be protected against current creditors in as little as 120 days. The Utah asset protection trust (UAPT) may not be used to try to defraud your creditors.
What are some of the benefits of a Utah asset protection trust (UAPT)?
- Assets placed in the trust are protected against future creditors.
- If certain approved actions listed in the statute are taken, assets are creditor protected after only 120 days.
- The trust maker can be beneficiary of the UAPT.
- The trust maker can live in the real estate held by the UAPT.
- The trust maker can be a co-trustee of the UAPT.
- The trust maker can decide how to invest the trust assets.
The Utah asset protection trust statute (UAPT) is one of the most effective in the country. Attorney Ben E. Connor, a St. George estate planning attorney, was a contributing author. Attorney Connor can be reached at 435-359-1414, 20 North Main Street, St. George, Utah, connorlegal.com.