GLOSSARY · TAX & ESTATE
Domestic asset protection trust
An irrevocable trust, allowed in roughly twenty states, that names its own creator as a discretionary beneficiary while blocking most of the creator's future creditors. It needs an independent trustee in the trust state. Its protection is uncertain for people who live in states that do not allow such trusts, and in bankruptcy a transfer to it can be undone for up to ten years.
Also called: DAPT, self-settled spendthrift trust, asset protection trust
LEARN IT PROPERLY
CHAPTER · WEALTH PROTECTION FUNDAMENTALS · FOUNDATIONSLLCs, Family Partnerships and Protection TrustsRELATED TERMS
SOURCES
- 11 U.S.C. § 548(e), Transfers to self-settled trusts. United States Code.