Nevada’s asset protection trusts have a reputation that attracts the ultrarich from all around the country. CNBC called Nevada a “global center of family trusts and a friendly home to the world’s biggest fortunes.”

However, your family doesn’t need to have billions of dollars in assets to benefit from a Nevada Asset Protection Trust (NAPT). So what benefits can an irrevocable NAPT offer those who want to protect their wealth for future generations?

Secrecy laws

Nevada is one of a small number of states that allow “silent” trusts. Under state law, trustees can keep the names of trust settlors (those who create the trust), beneficiaries of the trust and the trust names themselves confidential. Although they’re technically part of the public record, anyone seeking disclosure of this information must have a court order to do so.

“No exception creditors”

NAPTs don’t just protect assets from creditors and ex-spouses. They’re also protected from legal judgments in civil lawsuits. That means someone who sues a beneficiary and wins can’t access money that has been set aside for that beneficiary by their family. This can save someone from losing their inheritance. That’s why an NAPT is sometimes referred to as a “no exception creditor” trust.

Tax advantages that help trust income grow

Nevada has no state income tax for individuals or corporations in the state. That helps income in NAPTs and other trusts grow without any state tax implications. 

Like most states, Nevada doesn’t levy an inheritance tax on those who inherit assets from someone in the state. Unlike most estate-related taxes, state inheritance taxes are based on where the property is located rather than where the beneficiary lives. It also has no state estate tax. That, too, can mean a lot of money can stay in the hands of beneficiaries that would go to taxes in other states.

As outlined here, Nevada provides considerable protection for those who want to prevent taxes from eating away at their wealth and protect and grow it for future generations. It also provides unparalleled levels of privacy for those who want to keep their family and business assets out of the public eye. 

Getting sound estate planning guidance with your estate planning can help you take advantage of Nevada laws and also protect your wealth to the extent possible from federal estate taxes.