When planning for the future, most people underestimate how much it matters to establish their trust in the right location. South Dakota has become one of the most attractive states in the nation to create a trust due to the tax advantages, legal flexibility, and increased privacy protection.
Benefits of Establishing a South Dakota Trust
Below are some reasons you may want to consider working with Peoples Trust Company, LLC to establish your trust in South Dakota:
Tax Benefits
While you may be aware that South Dakota does not have an income tax, you may be less familiar with how that can benefit your trust. Income (such as interest, dividends, and capital gains) that is retained in a trust and not distributed may become subject to federal and state income taxes. While you may not be able to avoid federal taxes, you may avoid state income taxes with the right trust structure, even if you live in a higher income tax state. Avoiding state income taxes is a benefit that can compound overtime for you and heirs.
In addition, many states still have a state estate and/or inheritance tax. With no estate or inheritance tax in South Dakota, a South Dakota trust for some or all of your assets may be able to help shield you from paying estate or inheritance tax at the state level depending on the type of trust utilized.
One thing I say often to my clients is, “I haven’t met anyone who wants to pay more in taxes,” and a South Dakota trust may be the ticket to avoiding that.
Dynasty Trusts

South Dakota trust laws also allow for the establishment of dynasty trusts, which means your trust can live on forever. While many states create a deadline that your trust must terminate, a dynasty trusts avoid this limitation and gives you the ability to preserve wealth and provide for your family over many generations. This structure allows the assets to avoid paying federal estate taxes even as future generations benefit from the resources you have set aside.
Creditor Protection
South Dakota has favorable laws for the establishment of asset protection trusts. An asset protection trust allows you to place assets into a trust, still receive benefit from the trust, and receive creditor protection against lawsuits. This structure is especially valuable for individuals who are in occupations with a greater risk of lawsuits. This may also provide some additional benefits to high net worth individuals and families. While not available in every state, anyone can benefit from this type of structure by setting up a South Dakota asset protection trust.
Privacy & Confidentiality

South Dakota has some of the strongest trust privacy laws in the United States with all court filings related to trusts being automatically and permanently sealed. This helps ensure that your information and assets remain confidential and secure. If you value privacy and discretion for your family, a South Dakota trust may be the way to go.
Flexibility
None of us know what the future may hold for us or our family. When establishing a trust, you try to take into consideration many of the future possibilities for you and your family. However, unforeseen circumstances can arise that require your trust document to be edited. South Dakota allows you to name a trust protector in your trust and give that individual the ability to make changes to your document should the need arise. This allows your trust document to stay flexible and adapt to your family’s ever-changing needs and circumstances.
Learn More About Trust & Estate Planning
How Can Peoples Trust help?
Setting up your trust in South Dakota can provide you and your family with many long-term benefits. To take advantage of those benefits, it is important to have the right South Dakota trust company as your trustee. Contact Peoples Trust Company to discuss how a South Dakota trust may benefit you and your family.