Asset Protection Trusts in Tennessee

On July 1, 2007, an important new trust law took effect in Tennessee that may expand your financial planning options for high net worth clients, especially those whose occupations may expose them to litigation, such as doctors, attorneys and real estate investors or landlords.

Under the new law, individuals (including residents of other states) may create trusts in Tennessee that protect their assets from creditors, lawsuits and catastrophic events. The new Tennessee Investment Services Act makes Tennessee one of only nine states, including Delaware and Nevada, to allow self-settled trusts.

Under the new law,

• Assets (including homes) are insulated from creditors and litigation, yet individuals may take out income or principal and direct the investments of the trust.

• The length of time a trust can exist has been extended to 360 years (up from the previous 90 years), thereby protecting family wealth for a much greater length of time.

• Tennessee residents can keep their assets in-state, while residents of other states may now do business with a Tennessee trust company.

Cumberland Trust is one of very few trust companies that allow clients to retain their own investment advisers, and we would appreciate the chance to discuss the new law with you. Please call us at (615) 783-2540 for more information.

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