Articles

The Non-Judicial Settlement Agreement Wrapper—An Alternative to Directed Trusts

Trusts, Estates & Tax Group partner Todd Flubacher, and associate Kenneth Hunt, authored "The Non-Judicial Settlement Agreement Wrapper – An Alternative to Directed Trusts" featured in the December 2013 edition of Trusts & Estates

The country's leading trust jurisdictions have been experiencing enormous growth in recent years from two sources: the creation of new trusts and the migration of existing trusts to take advantage of more favorable administrative laws.  It's become commonplace to optimize planning through careful jurisdiction selection, migrating an existing trust to an advantageous jurisdiction and modifying the trust to capitalize on the new administrative laws, including converting it to a directed trust to accomplish specific objectives.  The techniques available to migrate and modify a trust including decanting, trust merger and judicial or non-judicial modification.  However, an alternative structure to directed trusts exists.  In jurisdictions that have adopted the Uniform Trust Code (UTC), and states that have adopted a stand-alone non-judicial settlement agreement (NJSA) statute, the concept of an "NJSA wrapper" is another tool for achieving client objectives, but one that requires a new way of thinking about trustee powers, duties and liabilities.

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Trusts & Estates is the monthly journal for estate planning and wealth management professionals.  Published since 1904, feature articles discuss estate planning and wealth preservation strategies and trends, paying particular attention to the impact of changes in U.S. Federal tax laws and IRS codes.  Monthly issues focus on new tax legislation, ethics, investments strategies, financial planning, elder law, charitable giving and financial services.

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Todd A. Flubacher, Kenneth F. Hunt, “The Non-Judicial Settlement Agreement Wrapper – An Alternative to Directed Trusts,” Trusts & Estates Magazine (December 2013)

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