Nevada is among the more than a dozen states that allow for the creation of asset protection trusts. The state understands that high-asset individuals and certain businesses are at risk of losing a portion of their wealth through adverse judgments and from creditors.
But who are the people who should consider creating a Nevada Asset Protection Trust (NAPT)? It is not just any person. The main criteria really are that they should have a significant amount of assets and that you want to protect them.
Protection from judgments, lawsuits and creditors
An NAPT protects business assets and personal assets from being seized in cases such as judgments against you, lawsuits, bankruptcy and divorce.
Such trusts are often created by wealthy individuals and people in high-risk jobs such as physicians, business owners, business executives and real estate developers. Many in this group face legal liabilities. Because of their wealth, they may consider themselves easy targets for creditors seeking to extract great amounts of money from them.
Among the assets often held in an NAPT include:
- Certain real estate
A person with a significant amount of assets would be a solid candidate for an NAPT. This tool will protect assets.
Important tool for non-residents, too
Nevada has become an attractive state for people seeking to create asset protection trusts. Remember, you do not have to be a state resident to establish this key estate planning tool. A number of non-state residents, as well as foreign citizens, have created NAPTs. The key element, though, is that the trustee must be a Nevada resident.