Result Oriented Solutions - Independenttrust
For Advisors

Explore the Advantages of South Dakota Trust Law 

South Dakota has established itself as a favorable destination for trusts, attributed to its progressive and business-friendly trust laws. Independent Trust Company’s home state offers a unique combination of asset protection, tax benefits, and flexibility in trust administration. Here are the key reasons why South Dakota has gained a reputation for its favorable trust laws:

Tax Benefits:

One of the key benefits of utilizing a South Dakota trustee is the favorable income tax environment. South Dakota does not impose state income tax on trust income, ensuring that more of the trust’s earnings remain with the beneficiaries. 

Asset Protection:

South Dakota boasts robust asset protection laws, providing a secure environment for trusts. The state allows for the creation of self-settled trusts, offering enhanced protection of assets against creditors. This feature is particularly appealing to individuals in professions prone to litigation or those concerned about safeguarding family wealth for future generations.

Directed Trusts:

Permitting the creation of Directed Trusts, South Dakota provides a unique level of customization in trust management. In a Directed Trust, the grantor can appoint different individuals or entities to fulfill specific roles within the trust structure. This allows for a tailored approach to asset management, investment and distributions decisions, and other aspects of trust administration.

Flexibility in Trust Administration:

South Dakota’s trust laws provide a high degree of flexibility in trust administration. The state allows for perpetual trusts, enabling families to establish trusts that can last for generations without the constraints imposed by the rule against perpetuities in many other jurisdictions. This flexibility allows for the creation of trusts that can adapt to changing family needs and circumstances over time.

Fast and Efficient Court System:

With a reputation for having a well-established and efficient court system, particularly when it comes to trust matters, South Dakota has designed its legal framework to facilitate the resolution of trust-related disputes quickly. This provides a stable and predictable environment for trust administration in the state.

Privacy Protection:

South Dakota is known for its strong commitment to client privacy. The state allows for confidential (sometimes referred to as “quiet”) trusts, ensuring that the details of trust arrangements, beneficiaries, and asset information remain private. This confidentiality is a crucial aspect for individuals and families who value discretion in their financial affairs.

Decanting Laws:

Residents from other states have the unique opportunity to leverage South Dakota’s advantageous trust laws through a process known as decanting. Decanting involves transferring assets from an existing trust to a new trust with more favorable terms. South Dakota’s permissive decanting laws make it a preferred destination for trust management.

Independent Trust Company is licensed and headquartered in South Dakota, helping families throughout the United States access and benefit from the numerous advantages of South Dakota trusts. Our experienced team stands ready to guide you through the intricacies of trust management, ensuring a tailored approach to meet your unique needs. Reach out to us today.


The Power of Decanting: Irrevocable ≠ Immovable — 10am MT  |  February 22, 2024