Domestic Asset Protection Trusts

Asset protection planning (and estate planning) frequently involves the use of one or more trusts. Possibilities include an offshore trust, Domestic Asset Protection Trust, irrevocable life insurance trust and various other kinds of trusts. 

Most of these trusts are designed to last for many years. It is therefore important to give the trustee the flexibility to adjust

Here are some of the people who should at least consider setting up an Ohio Legacy Trust:

  • Business owners
  • CEOs and Directors
  • Physicians
  • Accountants
  • Attorneys
  • People considering marriage
  • Others who are willing to part with total control of a portion of their assets

The following chart (prepared by my partner, Paul Fidler) provides some general

The Ohio Legacy Trust Act (part of Ohio House Bill 479) becomes effective on March 27, 2013.  Ohio will become one of approximately 15 states with what is commonly called a Domestic Asset Protection Trust Statute.

Ohio House Bill 479 also increases the Ohio homestead exemption and makes other changes that offer better asset protection

The Ohio Legacy Trust Act, which will become effective in March of 2013, cannot be used to avoid child support or alimony payments.  The new statute (part of Ohio House Bill 479) provides creditor protection under certain circumstances for assets contributed to a legacy trust (also commonly known as a domestic asset protection trust).  But

There are many factors to consider in deciding whether a particular jurisdiction is or is not favorable from an asset protection standpoint.  Certain states and foreign countries are clearly better than others.  There is a constant tension between the legal rights of creditors and debtors; and each jurisdiction is to some extent more or less

A number of states have enacted Domestic Asset Protection Trust (DAPT) legislationOhio may soon join those states.  These statutes authorize what are known as "self settled" trusts.  This essentially means that the person setting up the trust is also one of its beneficiaries.  Thus, the person setting up the trust is attempting

Ohio House Bill 479 — commonly known as the Ohio Asset Management Modernization Act (OAMMA) –would make Ohio a leading asset protection jurisdiction.  The proposed legislation would:

  • Permit a so-called Domestic Asset Protection Trust (DAPT).
  • Provide an essentially unlimited homestead exemption, similar to those in Florida, Texas and several other states.
  • Specifically protect inherited IRAs.