Many wealthy investors and their advisors turn to the State of Delaware when establishing trusts. Delaware is a trust-friendly jurisdiction with well-established trust laws that offer many advantages to grantors and beneficiaries.
- Potential income tax reduction: Delaware does not impose state income taxes on irrevocable trusts if beneficiaries reside in another state.
- Privacy protection: A Delaware trust is not public information because it does not have to be filed with the courts.
- In perpetuity ability: Delaware law allows establishment of dynasty trusts that span generations and potentially protect assets from estate, gift, inheritance and generation-skipping transfer taxes.1
- Beneficiary non-disclosure: Delaware law allows grantors to keep the existence or value of a beneficial trust secret from the beneficiary.
- Investment flexibility: Delaware law gives grantors broad latitude in determining how assets will be invested and who will manage them.
For clients who have considerable wealth or work in professions where personal liability is a concern, a Delaware trust may also afford asset and credit protection opportunities.
Under Delaware law, an individual can establish an irrevocable trust that protects assets from future creditor claims, while still allowing the grantor to retain an interest in and receive income from the trust. What’s more, through various “spendthrift” provisions, the trust assets can also be protected from claims by creditors of the trust’s beneficiaries.
At SunTrust Delaware Trust Company, our seasoned trust advisors offer you in-depth knowledge of Delaware trust law to help you with a full range of trust strategies that address your unique circumstances.