Nevada offers these distinct advantages for directed trusts:

• Favorable trust laws: Nevada has some of the most flexible trust laws in the United States, which allow for greater control and flexibility in trust design and administration, including the use of directed trusts.
• No state income tax: Nevada does not impose a state income tax on trust income. This can result in significant tax savings for high-net-worth individuals.
• Trust protector powers: Nevada law allows the appointment of a trust protector, who can have various powers including the ability to modify or amend the trust, remove and appoint a trustee, and direct or veto trust distributions.
• Separation of trustee duties: Nevada’s directed trust statute allows for a grantor to appoint an investment adviser to direct the trustee regarding investment decisions, vote proxies, value non-publicly held investments; and retains investment advisers and delegates any of its powers. A distribution adviser may be appointed to direct the trustee with regard to all discretionary distribution decisions. If a trust adviser, trust protector or other person designated in the trust has the authority to give directives that must be followed by the fiduciary, that person will be considered a “directing trust adviser.” This term does not include a trust adviser, trust protector or other person who gives recommendations that the fiduciary is not required to follow.
• Protection for directed trustees: A directed trustee is not liable for complying with the direction of a directing trust adviser and is not obligated to investigate or evaluate any direction made by the adviser.
• Fiduciary status for trust advisers and protectors: A trust adviser is considered a fiduciary under Nevada law unless the trust instrument states otherwise. A trust protector is held to a fiduciary standard if considered a “directing trust adviser.”

Note: The information provided here is for general educational and informational purposes only. It is not legal advice and should not be interpreted as such. For a thorough understanding of these topics relevant to your specific circumstances, we recommend consulting a qualified estate planning attorney. Peak Trust Company cannot provide legal advice; however, we can serve as an informational resource and provide referrals to highly skilled attorneys who can offer legal and tax guidance tailored to your specific needs.