In an unanimous decision, the Supreme Court strikes down North Carolina’s attempt to tax undistributed income of a resident trust properly sitused and administered in a no income tax state like South Dakota. You can read more about it by clicking here. Indicating that to do so is a violation of due process, the Court’s decision is a very important affirmation and validation of powerful state tax planning tools available in non-income tax jurisdictions, and again, underscores the vital importance of selecting proper trust jurisdiction in the planning process.

Join Bridgeford Trust, William Lipkind (Attorney, Partner, and Chair of Wilson Elser’s Tax Planning & Controversies practice), and Terry Prendergast (Of Counsel at Davenport, Evans, Hurwitz & Smith, LLP) for an informative webinar on Tuesday, July 9th at 2:00pm EST as we discuss the case and its practical implications with respect to state tax planning and the power of utilizing sophisticated modern trust law planning techniques, only available in top tier trust jurisdictions like South Dakota.

Webinar: Tuesday, July 9 at 2PM EST

Bridgeford Trust is proud to share that we joined forces with trust companies from South Dakota, and across the nation, to fund an Amicus Brief filed with the Court in support of the taxpayer, and the important constitutional issues at stake in this case. It was a very impressive effort, pulling together trust and legal professionals from all over the country with the focus of having a positive impact on the Court’s analysis in this very important case. The Court’s decision is a victory for the trust industry and planning community, and affirms powerful state tax planning techniques available by simply selecting the proper trust jurisdiction for trust formation and administration. Click here for information about these techniques and click here for a detailed chart comparing top tier trust jurisdictions.

We hope you can join us for this webinar! For more information, please contact Bridgeford Trust via our contact page.

On May 31st, Bridgeford Trust will be in Florida as a sponsor for STEP Miami’s 10th Annual Summit! The Summit, taking place at the Four Seasons Hotel in Miami, is an excellent opportunity to review the latest issues concerning international private client planning and includes presentations by leading professionals in the area. Last year’s Summit attracted more than 300 professionals from around the globe, so you won’t want to miss this one!

The financial services industry has seen a tremendous influx of international families coming to the United States for many reasons, and to South Dakota in particular because of the power and sophistication of its trust laws. South Dakota’s progressive and industry leading trust laws allow families to avail themselves of very strong privacy and asset protection provisions, and to take advantage of South Dakota’s status as a no state income tax state. To learn more about the South Dakota Advantage, click here.

Our team will be attending the Summit and if you are going to be there as well, we encourage you to visit Bridgeford Trust’s table and talk with us about how we may be able to collaborate to best serve the international community!

Given recent changes in the tax code, concerns around asset protection and privacy, and the huge influx of international families coming to the United States, selecting the proper U.S. trust jurisdiction in the planning process is more important now than ever. Below is an objective and well-researched chart comparing the leading U.S. trust jurisdictions, with a particular emphasis on areas and planning nuances that distinguish South Dakota as the superior trust jurisdiction in the overall analysis.

Click here to view the chart in PDF format and watch the video below to learn more.

Noting that Delaware, long considered to be a leading U.S. trust jurisdiction, is not keeping pace with other progressive U.S. trust jurisdictions, Trusts & Estates Magazine stated in its January 2018 edition that,

“While Delaware has been in the top 4 jurisdictions consistently for the past ten (10) years, we think that its asset protection laws still need to be strengthened for it to remain competitive.”

Alternatively, South Dakota has long been considered to be among the best trust jurisdictions in the nation because of its cutting edge laws around asset protection, dynasty and directed trusts, and privacy.

As illustrated by the shaded areas on the chart, there are six specific areas where South Dakota excels, rendering that state as the overall trust jurisdiction of choice for advisors across the country and around the world. South Dakota is generally regarded by most practitioners and academics, including Steve Oshins, a Nevada attorney, as being the best Dynasty Trust state and having the best Decanting Statute in the nation. Also, South Dakota unequivocally has the most robust privacy laws in the country, as pointed out by a recent article appearing in the January 2018 edition of Trusts & Estates Magazine comparing U.S. trust jurisdictions wherein the authors note,

“Of the top tier trust jurisdictions, South Dakota has the best privacy laws in the nation.”

In addition, South Dakota is one of only three states with a Community Property Trust, a compelling tax planning tool for spouses. Finally, South Dakota is the only state in the nation with a Special Purpose Entity legislation, a powerful planning nuance used in conjunction with directed trusts and trust protectors, and is also the only state with a Family Advisor statute, a non-fiduciary role similar to the trust protector.

For more information about South Dakota’s progressive and industry leading trust laws, click here. Contact Bridgeford Trust via our contact page with any questions or for additional information.

The South Dakota Community Property Special Spousal Trust is a very compelling and progressive tax planning tool. The trust may be revocable or irrevocable, created by one or both spouses with both spouses as beneficiaries. This is a very powerful state income and estate tax planning tool because it allows married settlors of the trust to avoid state taxation on undistributed retained income within the trust (because South Dakota does not have an income tax) and treats the property as community property at the death of the first spouse, applying a 100% step-up in basis at date of death, therefore, avoiding federal capital gains taxation of marital/trust assets when sold.

To date, there has not been a single challenge from any tax authority relative to the use and tax benefits of Community Property Trusts. 

Click here to review South Dakota’s statute, and click here for an article appearing in the South Dakota Law Review written by Terry Prendergast, leading South Dakota attorney who was instrumental in the drafting and passage of the statute.

The South Dakota Community Property Special Spousal Trust:

• Avoids federal capital gains taxation of marital/trust assets when subsequently sold. (In non-community property states, the step-up in basis at date of death is only 50%, which means that taxes would be owed on the remaining 50% of the cost basis of the marital property when sold.)
• Creates a powerful tax move that has the potential to result in compelling federal and state tax savings over subsequent generations by combining its benefits with the federal estate tax benefits of a Dynasty Trust in a jurisdiction that does not have an income tax, such as South Dakota, with the potential to avoid federal estate tax and state income tax on undistributed income forever.
• May also be created, in appropriate cases, to take advantage of South Dakota’s leading Directed Trust laws and Domestic Asset Protection Trust laws for enhanced protection from creditors.
• Leverages South Dakota’s privacy laws, considered by most commentators and Trusts & Estates Magazine as the best in the nation.

For more information on the South Dakota Community Property Trust and other powerful modern trust law concepts, please contact Bridgeford Trust via our contact page.