About South Dakota Planning Company
Typical Client Estate Plan
Why South Dakota?
Unique South Dakota Laws
Unlimited Trust Duration
State Income Tax Savings
Premium Tax Savings
Asset Protection
Reformation and Decanting
Privacy Statutes
International Families
Management Biographies

Why South Dakota?

SDTC's choice for a trust company location is South Dakota because of the state's advantageous trust and tax laws, its cost-efficient and dedicated workforce, the founders' previous favorable experience and their market recognition with the state. South Dakota was one of the first states (1983) to allow a trust to endure perpetually, essentially jumping outside the onerous federal transfer (gift, estate and generation-skipping) tax system theoretically forever. Currently, twenty-eight other states and Washington D.C. have joined the ranks of offering a long-term trust. Nineteen of these states and Washington D.C., including South Dakota, allow for a trust to go on in perpetuity.

South Dakota can be distinguished from these other states by its modern trust laws coupled with the fact that it does not impose any form of state taxation on the assets within the trust (no state income, capital gains, dividend/interest or intangible tax). Additionally, South Dakota has the lowest insurance premium tax of any state (i.e., 8 basis points or 8/100ths of 1%) and offers other very favorable insurance legislation. South Dakota also has excellent self-settled trust and third-party discretionary trust statutes, allowing for excellent domestic asset protection planning.

South Dakota was the first state in the U.S. with a discretionary trust statute for asset protection, which states that a discretionary interest in third-party trust, limited power of appointment, and remainder interest are not considered property interests. This statute is important for asset protection trusts set up to benefit one's family. South Dakota also has some of the top rated asset protection statutes for LLCs and LPs based upon a powerful "sole remedy charging order statute".

Most of the unique and creative trust strategies for the wealthy involve trust administration in South Dakota without the necessity of having the family reside there. One of SDTC's founders, Pierce McDowell, has taken a very prominent role on the state's trust legislative committee for more than 16 years so that SDTC and the state of South Dakota may best serve the wealthy and their advisors.

The information on this Private Trusts website is for general information purposes only. Nothing on this or associated pages, documents, comments, answers, emails, or other communications should be taken as legal advice for any individual case or situation. This information on this website is not intended to create, and receipt or viewing of this information does not constitute, an attorney-client relationship.