The legal situs of a trust does have a significant impact on its success, and no state offers trusts more opportunities than South Dakota. Security National Bank of South Dakota has the experienced professionals who have worked with attorneys and CPAs who have clients all across the United States. There is a reason why Trust&Estate magazine has repeatedly declared South Dakota to be the number 1- most favorable situs for trusts.
Working in conjunction with the 130 year old affiliated Security National Bank of Iowa, our clients and their advisors can draw upon the combined 800+ years of trust experience among our team. Regardless of the value of the trust, Security National Bank of South Dakota can help you make your dreams into realities.
Two offices for convenience: located in Dakota Dunes and Sioux Falls. Contact us today and learn more about how we can create a customized plan for you.
Why should I have my trust in South Dakota?
You would want your trust located in South Dakota to receive the benefits of a South Dakota Situs.
What are the benefits of a South Dakota Situs?
Certain South Dakota trusts that retain income will pay no state income tax and capital gains generated within the trusts will escape state capital gains taxes.
South Dakota repealed its state inheritance tax effective June 30, 2001. Residents of South Dakota pay no inheritance tax at death.
No state income tax on trusts and a self-settled asset protection trust rule. In addition to eliminating the rule against perpetuities, South Dakota has enacted, and continues to update, a favorable trust regimen in general, with a modern trust code, no state income tax on trusts, and a self-settled asset protection trust rule.
What is a situs?
It is the legal location of something that determines which state’s laws will govern it. Situs is generally obtained by invoking South Dakota law, having a resident South Dakota trustee, and having as much trust administration and custody of the trust’s assets in South Dakota as possible.
What does having South Dakota Situs mean?
To be governed by the laws of South Dakota a trust must be legally located in South Dakota. Having a South Dakota situs means the trust is considered to legally “reside” in South Dakota.
Do I need to live in South Dakota to have a South Dakota Trust?
No, the trust must have its situs in South Dakota, but the settlor does not need to be a resident of South Dakota.
How does my trust become a South Dakota trust?
The trust becomes a South Dakota trust if the language in the trust document says it is a South Dakota trust and is to be governed by South Dakota laws and the trustee is located in South Dakota.
Who can be a South Dakota Trustee?
South Dakota residents and bank trust departments and trust companies that have been chartered to provide trust services in South Dakota, such as Security National Bank of South Dakota.
What makes South Dakota better than other states for my trust?
1. Favorable Tax Treatment: South Dakota has no state income tax on trusts or individuals. However if you live in another state that has income taxes and receive the income from a South Dakota trust, your home state will tax you on the income you receive.
2. South Dakota law allows two specialized types of trusts that many other states do not.
a. South Dakota laws permit dynasty/perpetual trusts
b. South Dakota laws permit domestic asset protection trusts.
c. South Dakota has a very favorable process for decanting trusts into multiple smaller trusts.
3. South Dakota’s legal environment is favorable to business and trusts and has been on the leading edge of laws to help families and individuals manage and pass their assets. In fact, Trust and Estates Magazine repeatedly highlighted South Dakota as the most favorable state for trusts in it January 2014 issue.
What is a Perpetual or dynasty trusts?
A perpetual or “dynasty” trust is a trust that can legally exist forever. For a more detailed discussion of Perpetual or dynasty trusts, please click here.
What is a Domestic Asset protection Trust?
A domestic asset protection trust is a trust which protects trust assets from most claims of creditors, law suits or judgments. For a more detailed discussion of domestic asset protection trusts, please click here.
What does it mean to decant a trust and how could this help me?
Decanting is a legal process that allows a larger single trust to be subdivided into multiple smaller trusts for the beneficiaries of the larger trust. While the terms of the decanted trusts must remain the same as the trust they came from, the decanted trusts protect the privacy of each beneficiary and their individual transactions. Decanting also allows the trust investments to be more responsive to the tax situation of each beneficiary.
Why should I choose Security National Bank of South Dakota for my South Dakota Trust?
- Security National Bank of South Dakota in conjunction with Security National Corporation and its affiliated banks have over 130 years of continuous year of exceptional service to individuals and families needing of trust services.
- The Security National Wealth Management team of over 60 professionals has over 800 combined years of trust and investment experience.
- Security National Bank of South Dakota maintains the highest levels of compliance and training possible through regular ongoing examinations, audits and continuing education.
- Security National Bank of South Dakota manages and is accountable for its own investment decisions and operations, yet we are flexible enough to be able to work with virtually any professionals that support our client’s objectives.
- As a community owned bank, Security National Bank and its shareholders understand that confidence needs to be earned and proven each and every day.
- Security National Bank of South Dakota in conjunction with Security National Corporation and its affiliated banks manage over $2.2 billion in assets for over 2400 client relationships.
- We guarantee our service.