Question

Nevada Asset Protection Trust

Forum|Forum|6 years ago
February 15, 2020
1 reply
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Is a Nevada Asset Protection Trust considered a Grantor trust for federal tax purposes?

Not A Product Question

A

Anonymous_

Employee

@DTinNV wrote:

Is a Nevada Asset Protection Trust considered a Grantor trust for federal tax purposes?

That would actually depend upon the terms of the trust; it can be structured either way (grantor or nongrantor).

D

DTinNVAuthor

And how do I know which it is? If I am the investment trustee does that make it a Grantor trust?

A

Anonymous_

Employee

@DTinNV wrote:

And how do I know which it is?

Who set up the trust? That individual or firm should be able to tell you how it is structured.

Without getting too far into the weeds, if you, as beneficiary, basically have certain "powers" (particularly the power to withdraw all, or a significant portion, of the corpus (principal) of the trust), then the trust is likely to be considered a grantor trust.

Many trusts are designed as set forth above, but you have to read the trust instrument to be certain.