When you are considering an asset protection trust, it’s always helpful to know what to expect and how much an asset protection trust costs. This post does not go into detail about specifics of asset protection trusts and how they work. It is simply to outline the fee ranges you can expect to see out there and at the end I’ll also show where my fees fall within those ranges. You should know how much asset protection trusts cost.

Fee Ranges – $3,500 – $50,000+

Why are the fee ranges all over the map? Primarily because there are two main categories of asset protection trusts:

  1. Domestic Asset Protection Trusts (DAPT) – Established under the laws of one of the States within the United States, or
  2. Foreign Asset Protection Trusts (Offshore Trust or FAPT) – Established under the laws of a foreign jurisdiction (e.g. Cook Islands, Nevis)

Fee Ranges for Domestic Asset Protection Trusts – $3,500 – $10,000

Domestic asset protection trusts can be excellent tools to protect assets from personal liability exposure. Because they are domestic, they simpler to create and manage than offshore trusts. Likewise they are much less expensive. $3,500 to $10,000 is how much domestic asset protection trusts cost. The range here also depends on a few factors such as the State you live in (some states or metro areas have higher legal fees than others). It is quite common for attorneys to charge flat fees for trusts, including asset protection trusts. However, some will charge hourly rates. I haven’t seen do it yourself services provide asset protection trusts, and I’m grateful for that. They are sophisticated instruments and you should have qualified legal counsel when you create one.

In addition to the fees to set up a domestic asset protection trust, sometimes there may be ongoing fees. Ongoing fees may include trustee fees payable to a professional independent trustee. This is common if you wish to establish the trust in a state with more desirable trust laws and you need a trustee in that state. I’ll address trustee fee ranges in a later post. Some law firms may require annual maintenance fees for the trust to make sure everything is operated properly. Others will have no such ongoing fees but will charge their rates for any subsequent work or updates to your plan over time.

Fee Ranges for Foreign Asset Protection Trusts – $20,000 – $50,000+

I do not prepare foreign asset protection trusts, however there are many qualified attorneys nationwide who do, including partners at my firm. Offshore trusts are much more expensive because they have more sophisticated moving parts and involve other parties (in other countries). Attorneys who prepare offshore trusts must have extensive knowledge about United States laws as well as those in the foreign jurisdiction with respect to trusts. Attorneys should also understand who is a good candidate for an offshore trust. Depending on the complexity of the trust plan, the foreign jurisdiction used, and the law firm assisting you, your fees can range widely, but you can reasonably expect to pay $20,000+ for a foreign asset protection trust. In addition, you will need to pay annual compliance fees. Compliance fees for offshore trusts are expensive. These fees are to cover foreign trustee fees and other administrative fees as well as domestic legal and tax reporting fees. It is not uncommon to pay $5,000+ each year in compliance fees for a foreign asset protection trust. Your attorney will also charge fees for any additional work they assist with over time in maintenance and modification of your plan.

My Fees for Asset Protection Trusts – $5,000+

As I said earlier, I don’t prepare foreign asset protection trusts. I have over 10 years of experience and have helped hundreds of clients with domestic asset protection trusts. My fees are more often than not in the $5,000 range. Asset protection planning is not the same as tax planning. Asset protection trusts are generally tax neutral. However, when planning for some clients, we design irrevocable trusts for tax planning, such as intentionally defective grantor trusts for estate tax planning or non-grantor trusts for income tax planning. In these cases, the fees may be in the $9,000 to $12,000 range.

Conclusion

For asset protection trusts you should always seek advice from a qualified attorney. Be wary of non attorney asset protection providers, where your communications with them are not confidential. Attorney communications have the benefit of attorney client privilege. There are many factors to evaluate to determine whether or not you should have an asset protection trust. And if so, which assets to put into the trust. Why you should put those assets into the trust. And how you should put those assets into the trust. You want to avoid fraudulent/voidable transfers which will undermine the whole plan. You also want to know what type of trust is best for you and why. An attorney can help you evaluate these issues. And now you have a little more info about how much asset protection trusts cost.

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