What if I live in another state?
Can I still use an NAPT?
There is no question, a Nevada Asset Protection Trust (“NAPT”) works best if you are a resident of Nevada, the assets held by the trust are in Nevada, and all trustees are in the state.
However, because Nevada is one of the best states in which to set up a domestic asset protection trust, there is a great deal of interest by those living outside of Nevada in setting up an NAPT. How effective is this?
First, you should recognize that it is not a good idea to hold real estate located in another state in Nevada asset protection trusts. The state where the real estate is located has jurisdiction over that real property. If a creditor obtains a judgement against you, and the state does not recognize domestic asset protection trusts, then the court may disregard the trust and allow the creditor to attach the property anyway.
If a non-Nevada resident is going to set up an NAPT, it would be advisable to do so in conjunction with a Nevada LLC with assets that can be held in Nevada. The assets are held in the limited liability company, which in turn is owned by the NAPT. There must also be a Nevada trustee.
Unfortunately, the NAPT has probably been marketed too aggressively in states that do not recognize self-settled spendthrift trusts. While they can help, close attention to detail is a must.
If you are interested in whether an NAPT could work for you, call (702) 894-4110