The South Dakota legislature provides significant asset protection for trusts and business entities created in South Dakota. Below are reasons to consider the vibrancy of South Dakota trust and business laws:

1. Trusts & Estates magazine (January 2007) rated South Dakota as the #1 US perpetual trust jurisdiction.

2. South Dakota law provides for trusts with an unlimited duration. Such trusts allow for continued creditor and ex-spouse protection for beneficiaries. Family offices have also used such trusts to pass along philosophical values to future generations.

3. South Dakota focuses on keeping its trust laws cutting edge to allow for:

• Family members (and their professional advisors) to be involved in traditional roles fulfilled by the trustee through directed or delegated trusts.
• Changes to distributions and investment portfolio construction using trust protectors, investment committees and/or distribution committees.
• The South Dakota legislature is in session every year, allowing for more progressive action and constant oversight of trust legislation.

4. South Dakota does not require trust documents to be filed publicly. Updates or changes to a trust do not need to be filed with a South Dakota court. Privacy is a priority in South Dakota.

5. South Dakota has no state income tax or capital gains tax.

6. South Dakota has created unique trust statutes for asset protection trusts:

• South Dakota has enacted legislation which prohibits judicial foreclosure and creditor attachment on beneficial interests in trusts, powers of appointment held by beneficiaries, and reserved powers by a beneficiary. Additionally, a power of appointment in a trust is specifically excluded as a property interest.
• South Dakota is one of a handful of states in the United States that provide creditor protection for self-settled trusts. This is a type of trust into which a client transfers assets and he or she is the beneficiary. The client may retain a level of control over trustees or trust advisors, retain certain disposition rights to the trust, and the trust assets can still be protected from creditors.
• In addition to trust law, South Dakota business law provides a significant level of creditor protection for certain South Dakota situs entities. For instance, South Dakota's limited liability company (LLC) and limited partnership (LP) statutes provide that the sole and exclusive remedy available to a creditor of a member or partner is a “charging order” against the member or partner’s interest. If a member or partner is successfully sued, the creditor obtains only the right to any distributions made to the member or partner. The creditor receives no voting rights, management rights, rights to examine the company’s books or records, or powers to compel distribution.