What is a self-settled trust?

A self-settled trust is a type of trust that allows the trust creator to be the beneficiary of the trust, which means they can benefit from their own trust. This type of trust can be used in asset protection law in the District of Columbia. In a self-settled trust, the creator of the trust, known as the settlor or trustor, transfers their assets into the trust. This allows them to protect their assets from creditors and other legal actions. A third party, such as a trust company or a lawyer, acts as the trustee and is responsible for managing the trust and protecting the assets. The trust is also structured so that the settlor does not have control over the assets, which limits their liability. For example, if the settlor is sued, their creditors cannot seek the trust assets to satisfy judgments. This provides the settlor with a layer of protection from creditors. The trust is also beneficial in terms of estate planning because it can be used to provide security for the settlor if they become incapacitated. The trustee can make decisions on the settlor’s behalf, ensuring that the assets are handled in the right manner. Overall, a self-settled trust is an effective way to protect assets and ensure that they are managed properly in the event of death or incapacitation. Using this type of trust in conjunction with asset protection laws in the District of Columbia can provide peace of mind for the settlor and their beneficiaries.

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What is a self-settled trust?

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