Using DAP Trusts in WV to Keep Heirlooms in Your Family
Grandmother's wedding ring holds deep sentimental value to the family. It also holds substantial financial value. This is an heirloom that you have been honored to have had passed down to you and one that you would like to keep in your family. A West Virginia DAP trust, or domestic asset protection trust, is a tool to help you do just that.
DAP Trusts in WV can be used to protect valuable heirlooms such as jewelry, art, antiques, and other valuable property from financial distribution to creditors. The sentimental value of these items may far outweigh the financial value to you and your family. However, a creditor will only be interested in the financial value and may attempt to force a sale in order to garner funds owed to that creditor.
Developing an estate planning asset protection strategy with an estate planning attorney in WV is the best way to proactively defend your family heirlooms from potential future creditors.
Are DAP Trusts in WV Right for My Estate Plan?
Estate plans are as individual as you are. Your values and your family dynamic will certainly come into play when determining your estate planning needs. A DAP trust is just one tool in an estate plan.
These asset protection trusts protect your property by preventing a beneficiary from selling the property you want to protect, such as your grandmother's wedding ring. The trust will also protect that property from future creditors who might attempt to force the sale of valuable property to recover their claims against a beneficiary's estate.
The first step is to consider what valuables you want to protect from potential creditors to keep in your family. Next, work with an experienced estate planning attorney, who can help you protect these assets and create the best plan for you and your family.
What Assets Are Protected by a West Virginia DAP Trust?
Grandmother's wedding ring is not the only valuable that DAP trusts in WV can protect. Family heirlooms can include anything with high sentimental value. The items that you will want to protect with a domestic asset protection trust are those heirlooms with a high financial value such as jewelry, art, antiques, fine china, silver, and works on paper such as prints or antique books.
DAP trusts offer to other assets, too. Real estate and certain financial accounts can also be placed in an asset protection trust. You can set the trust up in such a way that you have access to your assets while you're alive, they are protected from potential future creditors, and the use and benefits of the property and financial assets in the trust can smoothly pass to your heirs upon your death.
Are There Exclusions of DAP Trusts in WV?
There are exclusions to the protections of a DAP trust. Under West Virginia Code § 44D-5-503, the assets held in the trust are not protected against:
- A child seeking to enforce a child support order;
- A judgment creditor that helped the beneficiary protect the assets in the domestic asset protection trust; or
- A claim by the State of West Virginia or the United States to the extent the law allows.
Who Can be Named as Beneficiary of a DAP Trust?
If the goal of your trust is to protect family heirlooms and to pass them down to the next generation in your family, then your beneficiary should be that family member. However, you can name anyone as the beneficiary of DAP trusts in WV.
You can even name yourself as a beneficiary of your domestic asset protection trust. These trusts are called self-settled spendthrift trusts. Naming yourself as the beneficiary of the trust allows you to have use of and control over the assets while you are alive. The property will be protected from any future creditors you might develop.
As you deem in the trust, upon your death, those assets will pass to the trusts's other designated beneficiaries. The assets will remain protected under the provisions of the trust from any creditors your beneficiaries might have. The trust also prevents any beneficiary from selling trust assets, ensuring that your prized family heirlooms stay in the family.
What are the Terms and Conditions of a Domestic Asset Protection Trust?
To be legally binding, DAP trusts in WV must contain certain terms and conditions. Without the following conditions in place, your trust will not be valid, and your assets will be vulnerable to creditors and potentially subject to probate:
- The DAP trust must be irrevocable, meaning you cannot change the terms or conditions of the trust.
- The trust must name a qualified trustee as defined by West Virginia Code § 44D-5-503B(a).
- The creator of the trust may be a beneficiary but may not be the sole beneficiary of the trust.
- The assets protected in the trust must have been obtained legally.
- The creation of the trust cannot be an attempt to evade creditors or a direct attempt to protect assets from filing bankruptcy.
- The creator of the trust must submit an affidavit attesting to the legality of the assets and the creator's good standing with creditors prior to the transfer of any asset to the DAP trust.
Where Do I Find Help Setting Up DAP Trusts in WV?
Family heirlooms can have deep emotional ties to you and your family. If they also have significant financial value associated with them, you will want to consider your options for protecting those assets from future creditors.
Creating DAP trusts in WV with the help of an estate planning attorney will preserve your family history for the benefit of yourself and your loved ones after you're gone. If you would like discuss your options for estate planning asset protection strategies, contact Anna M. Price at Jenkins Fenstermaker, PLLC by calling 866-617-4736 toll-free or complete her e-mail contact form.