A Domestic Asset Protection Trust (DAPT) is one that many wealthy individuals and families use to shield their assets from creditors. The way that this trust works, it can also be a valuable help in a divorce situation. A DAPT is an irrevocable trust, which means that once it is formed, it cannot be altered. This is important, because if you were contacted by creditors they can come after any assets that you have control over.
With an irrevocable living trust, you relinquish all rights to the assets and your creditors can't access them either. In a DAPT, the trust creator becomes the discretionary beneficiary. The trust's assets will still be protected from the creator's creditors. If you create a DAPT and then also draft a prenup prior to marriage, it can provide excellent protection of your assets should you end up in a difficult situation in the future with your spouse. Talk to a San Fernando divorce attorney at Cutter & Lax today if you want more information.
