Bridgeford to Present on May 12 Strafford Webinar – Private Placement Life Insurance

Bridgeford Trust Company is participating in an upcoming webinar – Private Placement Life Insurance: Avoiding Income and Transfer Tax for High-Net-Worth Taxpayers – scheduled for Thursday, May 12, 2022, from 1:00pm-2:50pm EDT. If you are a tax advisor working with wealthy clients in high income tax brackets, and particularly those in high taxed states, be sure to join us to understand Private Placement Life Insurance (PPLI) and how to take advantage of this powerful tax planning tool.

PPLI allows high-net-worth individuals and family offices to purchase alternative investments that grow tax-free in insurance dedicated funds (IDFs) and can be distributed tax-free upon the death of the insured. Since earnings on comparable investments held personally would be subject to federal tax at ordinary or capital gains rates and state income tax, individuals residing in states like New York and California can reap tax savings of nearly 50 percent. Along with tax savings, owners can access the funds tax-free by withdrawing original contributions or borrowing from the policy. PPLIs, however, are subject to stringent IRS guidelines. Insurance standards, diversification, and owner control requirements must be satisfied; otherwise, the policy could be disqualified, resulting in significant tax obligations and penalties.

This webinar will explain PPLI, including structuring considerations, asset selection, optimal trust jurisdictions for PPLI, and meeting IRS requirements for tax practitioners working with high-net-worth taxpayers. The webinar’s panel of experts include David Warren, Co-Founder and Chairman of the Board of Bridgeford Trust Company and William Lipkind, Partner at Wilson Elser.

The panel will discuss the benefits and caveats of PPLI and will review these important issues:

  • What restrictions are placed on an investor’s interactions with the PPLI?
  • Meeting the diversification of asset requirements.
  • Establishing and funding an IDF.
  • How does the owner withdraw funds tax-free?
  • What steps can be taken to minimize the risk of disqualification?

The webinar program is produced by Strafford, a leading education company providing premium CLE and CPE courses designed for planning professionals in over 40 legal, accounting, and tax practice areas.

To learn more about this webinar, please click here. If you are interested in attending, please reach out to Melissa Roberson, Global Marketing and Digital Media Director, at mroberson@bridgefordtrust.com to inquire about limited passes we have available for friends of Bridgeford.

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What is a South Dakota Dynasty Trust and Why Does Jurisdiction Matter?

South Dakota was the first state in the nation to abolish the Rule Against Perpetuities – which prohibited unlimited-duration trusts – in 1983, clearing the way for the creation of the Dynasty Trust. A South Dakota Dynasty Trust is a very powerful planning tool that preserves family wealth over generations, allowing a trust to live in perpetuity (forever), therefore never subjecting the assets to federal estate taxation through a forced distribution.

Because the decision as to where to create a trust is critical, it is important to note that Dynasty Trusts are governed by state law, and many states who tout the Dynasty Trust have merely amended the Rule Against Perpetuities to extend the time when a trust must terminate, or do not have the myriad of other progressive modern trust laws available in South Dakota (see below). Understanding the vital importance of selecting the proper trust situs in the planning process, Nevada attorney, Steve Oshins, produces an annual rankings chart of Dynasty Trust states. In the most recently published comparison chart, South Dakota continues to rank as the top Dynasty Trust state in the nation – for the ninth consecutive year.

Understanding South Dakota’s Dynasty Trust

  • South Dakota Dynasty Trusts are available to residents and non-residents. The only requirement is that the trustee be a South Dakota resident and that South Dakota laws apply to the trust.
  • South Dakota allows trusts to continue in perpetuity, avoiding federal transfer taxes for generations.
  • South Dakota does not impose any form of taxation (income, dividend interest, capital gains) on these trust assets so there can be additional compelling tax savings for clients and their families, particularly under the Supreme Court’s ruling in Kaestner, where it was held that it is unconstitutional for a state to tax undistributed trust income properly sitused and administered in a no income tax state, like South Dakota (learn more about the Kaestner case).
  • Through the use of the Dynasty Trust, families can reduce the tax burden on successive generations of beneficiaries while still giving them the use of the assets during their lifetime (learn more about state taxation of trusts).

Additional Benefits of a South Dakota Dynasty Trust

  • South Dakota Dynasty Trusts, whether designed as self-settled or 3rd party trusts, can also incorporate spendthrift provisions to prevent future creditors (including former spouses) from directly accessing trust assets (learn more about Domestic Asset Protection from a recent webinar we hosted).
  • South Dakota has the most robust privacy trust laws in the nation, with a total, non-discretionary seal on trust information forever, allowing for increased privacy and confidentiality protections. Most states have no privacy provisions and in Delaware, after 3 years, sealed trust information can become public.
  • While a South Dakota Dynasty Trust can endure for an unlimited duration, because of powerful modern trust planning tools such as the Directed Trust and Trust Protector, settlors of trusts, beneficiaries, and their advisors can maintain tremendous control and direction over vital aspects of trust creation, administration, and modification, through the use of South Dakota’s powerful decanting statute, considered the best in the nation.
  • The availability of the Special Purpose Entity, as well as the Community Property Trust and Family Advisor (all planning tools not available in other U.S. trust jurisdictions). South Dakota’s modern trust laws are the reason why that state has been ranked as the top Dynasty Trust state in the nation by advisors, industry experts, and publications, including Trusts & Estates magazine (learn more about why South Dakota was named a top-tier trust jurisdiction by Trusts & Estates magazine).

We encourage you to view Bridgeford Trust Company’s comparison chart of the leading top-tier U.S trust jurisdictions and where they rank in terms of Dynasty Trusts. This chart also illustrates many other progressive trust topics and laws that distinguish South Dakota as the best U.S. trust jurisdiction in the overall analysis.

You can also watch this video about Dynasty Trusts on Bridgeford’s YouTube channel to learn more about its history, how they work, and why South Dakota has been ranked as the top Dynasty Trust state in the nation.

For more information on the Dynasty Trust and how it combines with South Dakota’s modern trust laws to create this powerful planning opportunity for advisors and their clients, please contact us via our contact page or by calling (605) 224-9189.

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Primer on Working with Ultra-High-Net-Worth Family and Family Offices

Trusts & Estates and WealthManagement.com recently presented a series of live CE and CLE virtual forums on March 1-2, 2022. These forums provided expert perspectives on what’s new – and what’s coming next – in wealth planning.

During one of the March 1st presentations, Bridgeford Trust Company sponsored, moderated, and presented a timely session entitled “Primer on Working with Ultra-High-Net-Worth Family and Family Offices.” If you missed this session which addressed the issues involved in working with ultra-high-net-worth (UHNW) clients and family offices, you can watch the full presentation below or on Bridgeford’s YouTube channel.

Topics included: the definition of family office and the different types of family offices; how UHNW families and their single-family offices (SFOs) use private trust companies; regulatory concerns for SFOs, investments; the IRS Wealth Squad; and changes made and lessons learned from the pandemic. Speakers included: David Warren, Co-Founder and Chairman of Bridgeford Trust Company; Kim Kamin, Principal & Chief Wealth Strategist at Gresham Partners LLC; Hugh Magill, Vice Chairman, Retired at Northern Trust; and Domingo Such III, Partner at Perkins Coie.

For more information on any of the topics discussed during this presentation, feel free to contact us via our contact page or by calling (605) 224-9189.

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Selecting the Proper U.S. Trust Jurisdiction: Is There a Fiduciary Duty?

As modern trust laws have proliferated over the past 20 years, the decision as to where to place a trust has become as important as the decision to create one in the planning process. Researching and identifying states with the most sophisticated and powerful trust planning tools around asset protection, privacy trust laws, and trust tax planning has become of paramount importance, especially as these tools deliver direction and control to settlors of trusts, beneficiaries, and their advisors. For this reason, industry publications have focused on this vitally important jurisdiction decision, producing objective education pieces, statutory analysis, and well-researched comparative charts which led to Bridgeford Trust Company’s trust jurisdiction chart comparing the leading top-tier U.S. trust jurisdictions, with a particular emphasis on areas that clearly distinguish South Dakota as the superior trust jurisdiction in the overall analysis.

Developing case law and other legal authority governing and guiding the fiduciary industry, including the Uniform Probate Code and the Restatement (Third) of Trusts, has clearly identified a duty to select proper trust jurisdiction in the planning process. Even further, there is a continuing duty to ensure that jurisdiction is proper, with at least one state Supreme Court case suggesting that there is a duty to decant a trust and move it to a more favorable trust jurisdiction to protect trust assets. The video below analyzes the legal authority and examines the question as to whether there is, in fact, a fiduciary duty to select the proper trust jurisdiction, and whether it may be professional malpractice not to do so in the planning process.

We’d love to hear from you to discuss this fiduciary duty to select the proper U.S. trust jurisdiction further! As always, please feel free to reach out about this and other information about powerful modern trust law concepts and the South Dakota Advantage by contacting us via our contact page or by calling (605) 224-9189.

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Bridgeford featured on The Truth About Wealth Podcast – How to Choose the Right Trustee

Copper Beech Financial Group, a financial planning firm based in New Jersey, recently interviewed David A. Warren, Co-Founder and Chairman of Bridgeford Trust Company on their podcast, The Truth About Wealth. Copper Beech acts as a family CFO to their clients and provides family office services that focus on tax efficiency, asset protection, and family governance. This podcast, hosted by John Parise, Managing Partner and Michael Parise, Supervisory Principal, guides listeners through eye-opening questions to help them discover the truth about their wealth.

During the episode, John and Michael talk with David about the challenges of picking the right trustee and/or trust company, and highlights the things you can do to make a better decision for your family. The discussion includes information on modern trust law, asset protection and its benefits, conflicts of interest in trust planning, and top-tier trust jurisdictions.

You can listen to the full episode by clicking here.

If you have any questions on how to choose the right trustee or any of the other topics discussed in this episode, don’t hesitate to contact us via our contact page or by calling (605) 224-9189.

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Bridgeford to Speak at STEP Miami’s Corporate Transparency Act Webinar: February 24

Bridgeford Trust Company will be presenting at an important and timely webinar hosted by STEP Miami – Corporate Transparency Act: A Discussion on the Impact on International Clients and More.

The Corporate Transparency Act (CTA) was enacted into law on January 1, 2021, as part of the National Defense Authorization Act for fiscal year 2021, and tasked the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) with implementation through regulations. On December 7, 2022, FinCEN issued its first set of proposed regulations regarding the “beneficial ownership information” requirements.

This webinar – taking place on Thursday, February 24, 2022 from 12:00pm to 2:00pm EST – will include the following speakers: David Warren, Co-Founder and Chairman of Bridgeford Trust Company; Joseph Kellogg, Partner and Head of Wealth Planning with WE Family Offices; and Osvaldo Garcia, Associate at Bilzin Sumberg as well as Jennifer Wioncek, Partner at Bilzin Sumberg as moderator.

During the presentation, the speakers will discuss:

  • An overview of the CTA.
  • The CTA’s impact on common trust and holding company structures used by international clients.
  • How the proposed regulations will impact law firms, trust companies, and family offices with respect to their obligations and their client obligations and what professionals and their clients should be doing to prepare.

There is no fee for STEP Members to attend; and $40 fee for non-members. You can register for this webinar by clicking here.

STEP Members are also invited to join an in-person Happy Hour taking place at a location on Brickell in Miami from 5:30pm to 7:30pm. Members will have a chance to meet the speakers, ask questions about the presentation or simply have a drink together! If you would like to attend the cocktail, please email STEP Miami directly at step.miami@step.org.

If you have any questions, don’t hesitate to contact us. We look forward to you joining us for this important discussion!

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Bridgeford to Participate and Present in Trusts & Estates Virtual Forum: March 1

Trusts & Estates and WealthManagement.com are presenting “Keeping Up With New Developments,” a series of live CE and CLE virtual forums scheduled for March 1-2, 2022. These forums will provide expert perspectives on what’s new – and what’s coming next – in wealth planning.

Join us for the March 1st presentation as Bridgeford Trust Company sponsors, moderates, and presents this timely session entitled “Primer on Working with Ultra-High-Net-Worth Family and Family Offices” taking place at 11:00am EST. David Warren, Co-Founder and Chairman of Bridgeford Trust Company, will be participating in this very timely and informative session that will address the issues involved in working with ultra-high-net-worth (UHNW) clients and family offices.

Topics will include: the definition of family office and the different types of family offices; how UHNW families and their single-family offices (SFOs) use private trust companies; regulatory concerns for SFOs, investments; the IRS Wealth Squad; and changes made and lessons learned from the pandemic. Panelists will include: Kim Kamin, Principal & Chief Wealth Strategist at Gresham Partners LLC; Hugh Magill, Vice Chairman, Retired at Northern Trust; and Domingo Such III, Partner at Perkins Coie.

This discussion is sure to be a great one as David and the panelists keep the audience up-to-date on these developments and new trends in wealth planning. To register for this complimentary event, click here.

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Best U.S. Trust Situs in 2022? South Dakota Named “Top-Tier Trust Jurisdiction” by Trusts & Estates Magazine

Trusts & Estates magazine has once again named South Dakota as a top-tier trust jurisdiction, with Wyoming, New Hampshire, Tennessee, and Ohio ranked as 2nd tier. Every two years, Trusts & Estates magazine evaluates trust jurisdictions utilizing an objective approach that considers the following factors: 1) whether a state has a Rule Against Perpetuities; 2) whether a state has income, inheritance, or premium taxes; 3) whether the state has adopted “modern trust laws” such as decanting provisions, directed trust capability, and privacy options; 4) whether a state has an asset protection statute and the effectiveness of the statute; and 5) the effect of migration on the rights of beneficial interest.

South Dakota has been consistently considered by many commentators and planners to be the best trust jurisdiction in the nation because of its cutting-edge laws around asset protection, dynasty trusts and directed trusts, and privacy. Trusts & Estates magazine’s article again accentuates the vital importance of selecting the proper trust jurisdiction, stating:

“There continues to be marked differences between the laws of those jurisdictions that we consider ‘the best’ for trusts and those that we deem less competitive. Planning professionals who cater to UHNW clients need to understand the different trust laws and planning opportunities and how they affect those clients and their beneficiaries. This is especially true when the landscape for planning strategies for their UHNW clients is under tremendous pressure to change.”

You can view the complete article entitled “Which Trust Situs is Best in 2022?” by clicking here. This article was written by Daniel G. Worthington and Mark Merric and featured on WealthManagement.com which is the digital resource of Trusts & Estates magazine.

South Dakota Advantage

The authors’ conclusion in this article is particularly compelling when considered in conjunction with the fact that 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. In addition, the authors of the aforementioned article concur with Mr. Oshins, stating, “South Dakota has the most flexible decanting statute…and appears to provide the best example of flexibility for trust remodeling.”
  • Unequivocally has the most robust privacy trust laws in the country, as pointed out in the Trusts & Estates magazine article wherein the authors noted, “Of the top-tier jurisdictions, South Dakota has the best trust privacy laws.” (Also, take note of footnote #35 in the article, where a post written by Bridgeford Trust Company was cited and quoted.)
  • Is one of only two states with a Community Property Trust, a compelling tax planning tool for spouses.
  • Is the only state in the country with the Family Advisor, referred to as a “Trust Protector Light;” not mentioned in the article but a very important planning tool.
  • Has one of the lowest insurance premium taxes in the nation at 8 basis points, which applies to both policies held by individuals and policies held within an LLC. (While Delaware boasts 0 basis points on policies held by individuals, policies held within an LLC – which is typically the case – are taxed at 200 basis points.)
  • Is the most fiscally sound among all top-tier trust jurisdictions.

When all of these attributes are considered in the aggregate, South Dakota clearly emerges as the superior trust jurisdiction in the nation. View this well-researched chart comparing the leading U.S. trust jurisdictions, with a particular emphasis on areas that clearly distinguish South Dakota as the superior trust jurisdiction in the overall analysis.

For more information about this article and the South Dakota Advantage, please reach out to Bridgeford Trust Company via our contact page or by calling (605) 224-9189.

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Bridgeford Expands Leadership Team; Adds Ashley Blake as President and General Counsel

Bridgeford Trust Company enthusiastically announces the expansion of our leadership team to include Ashley Blake as President and General Counsel. Ashley has multiple years of experience assisting clients and their advisors with the power and sophistication of South Dakota’s modern trust laws.

An attorney by training, Ashley has a deep understanding of South Dakota trust law and trust company law. Prior to joining the Bridgeford team, she practiced for multiple years at Davenport, Evans, Hurwitz, & Smith LLP – one of the oldest, largest, and most prestigious law firms in South Dakota. Ashley specialized in South Dakota trust and trust company law at her firm, regularly working with attorneys, advisors, and clients across the nation and around the world. Ashley understands the nuances of South Dakota trust law and ways it can be utilized for the benefit of Bridgeford’s clients, both domestically and internationally.

In her prior position, Ashley regularly assisted her clients with a vast array of trust administration issues including: modification or reformation, decanting, division or severance, merger or consolidation, termination, removal or appointment of trustee, advisor, or trust protector, court approval of accountings, virtual representation questions, and changing the situs and governing law of trusts. She also regularly reviewed trusts drafted by out-of-state attorneys for South Dakota validity and provided guidance to her trust administration clients on the requirements of South Dakota trust law. Helping her clients achieve their objectives both non-judicially and through formal court approval, Ashley has worked with numerous ultra-high net worth clients and their attorneys and advisors on a variety of trust issues, from consent-based matters to contested litigation.

In addition to her trust administration experience, Ashley is an industry leader on South Dakota trust company compliance and regularly assisted trust companies, both public and private, with regulatory compliance matters in her prior role. Ashley earned her Bachelors, with Honors and a double major, from Harvard University and graduated first in her class and with Sterling Honors from the University of South Dakota Law School, where she received numerous scholarships and awards.

Bringing a wealth of trust and trust company experience to the team, Ashley will serve on both Bridgeford Trust Company’s Board of Managers and Trust Administrative Committees. She will also lead all of Bridgeford Trust Company’s South Dakota operations from our office in Sioux Falls. Ashley will specifically oversee and work closely with Bridgeford Trust Company’s trust administrative and compliance teams in both our Pierre and Sioux Falls offices, focus extensively on strategic plan implementation, and support the company’s growth, business development, and legal initiatives.

David A. Warren, Co-Founder and Chairman of the Board, comments,

“As one of Bridgeford’s trusted and reliable external legal advisors for years, I have directly experienced Ashley’s tremendous legal acumen, smart and practical approach to problem solving, superior knowledge of South Dakota law, and intimate understanding of trust company operations and compliance – all skills and attributes that will make her an outstanding member of Bridgeford Trust Company’s leadership – and we could not be more thrilled to welcome her to the team as we continue our growth across the nation and around the world.”

Please join us in welcoming Ashley to the Bridgeford team! As she begins her new role with us officially on February 1, 2022, we encourage you to reach out to get to know Ashley and see how her unique personal and professional background make her ideally suited for her new role at Bridgeford. For questions or further information on our continued growth, don’t hesitate to contact us via our contact page or by calling (605) 224-9189.

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President and CEO, Linda Voller, Retires from Bridgeford Trust Company

Bridgeford Trust Company announces the retirement of President and CEO, Linda Voller, effective December 31, 2021. A Certified Trust and Fiduciary Advisor (CTFA) by training and highly experienced trust professional, Linda began her career in the trust industry in the mid-1990s working with Delta Trust Company of South Dakota, Inc. based in Pierre, South Dakota, with a primary focus on serving the trust needs of one of America’s largest and most prominent families. As Delta Trust Company evolved, Linda utilized her impressive fiduciary expertise working with “startup” public and private South Dakota trust companies, often serving as a Board of Manager and Administrative Trust Committee member.

 

In July of 2018, Delta Trust Company merged with Bridgeford Trust Company and Linda soon ascended to the role of President and CEO, leading our company’s trust administrative and corporate functions in South Dakota, while continuing to serve as Trust Officer for several large families across the nation. Linda’s contributions to Bridgeford Trust Company’s success, growth, and expansion – both nationally and internationally – these past years has been unmeasurable.  

 

David A. Warren, Co-Founder and Chairman of the Board shares,

“Linda conscientiously and passionately served the families, advisors, and trust companies she worked with around the nation with unparalleled attention to detail, efficiency, and responsiveness – attributes she also brought to Bridgeford’s internal operations, which helped fuel our company’s great growth and success. We thank Linda for her service and commitment to Bridgeford, and wish her the best in her very well-earned retirement years.”

 

Please join us in celebrating Linda’s contributions and wishing her well in retirement. Bridgeford looks forward to 2022 and beyond with great excitement and optimism as we will soon announce the addition of outstanding talent joining our leadership team, and continued company growth and expansion, both domestically and internationally.  

 

For questions, please contact us via our contact form or by calling (605) 224-9189.

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