Starting this month, you'll notice some new names on our editorial advisory board list. We've added a committee of practitioners we feel have been underrepresented when it comes to input on content in our magazine.
Tax & Accounting US, CCH Research & Learning Wolters Kluwer
Creating Creditor Protection Trusts Must Extend Beyond the Spendthrift Provision
In discussing the creditor protection of trusts, practitioners almost always focus first on whether the trust has a spendthrift provision and the protections afforded by the spendthrift provision. In our opinion, this is much like focusing on whether your car has a “Police Up Ahead Alerter” when in fact your car cannot go greater than 30 mph.
Sympathetic to the claims that so-called warehousing is generally bad. Another common concern is that because DAFs are generally pass-throughs to other charities, various sorts of donor abuses can occur and are more likely than when charitable contributions go directly to “real” charities. Such abuses range from sophisticated estate-planning transactions down to donors running contributions to athletic departments for tickets through a DAF to obtain a 100 percent charitable deduction rather than the allowed 80 percent deduction.
Fiduciary and personal interests occasionally conflict in the investment or management of trust property. Transactions which are “affected by a conflict” are generally voidable by an affected beneficiary.