What is a domestic self-settled trust?

A domestic self-settled trust is a type of trust used to protect assets from creditors. This type of trust is established in New York State and is often used to protect assets from future creditors. Assets held in a domestic self-settled trust are not available to creditors and cannot be taken away from the trustor. When assets are placed in this type of trust, the law in New York State states that creditors are no longer able to have access to the trust assets. The trustor, who sets up and manages the trust, is able to use the assets for their own benefit as long as they are not used to make payments to creditors. The trustor is also able to take a distribution from the trust for their own needs and not pay the creditors. Domestic self-settled trusts are a good way to protect assets from creditors. These trusts provide a secure way to preserve assets for future generations and ensure that the trustor is able to access the assets when needed. This type of trust also provides a layer of asset protection that is not available with other estate planning tools.

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