Stand-By South Dakota Dynasty Trusts

The Stand-by South Dakota Dynasty Trust is a strategy for foreign citizens with U.S. beneficiaries that have established foreign trusts in off-shore jurisdictions. Upon the grantor’s death, the foreign trust pours over the trust assets to an existing (nominally funded) Stand-by South Dakota Dynasty trust. This strategy could help to avoid the burdensome income tax filing requirements of the U.S. beneficiaries and the negative U.S. income tax rules on distributions of accumulated income.