Governor Snyder has signed into law two bills
(effective on March 8, 2017) that now allow a DAPT (Domestic Asset Protection
Trust) to be created in Michigan. Public
Act 330 establishes the Qualified Dispositions in Trust Act. Public Act 331,
which amends the Uniform Fraudulent Transfer Act, complements Public Act 330. Together,
the two laws combine to give Michigan residents another tool for protecting
their assets from creditors including tort claimants.
If a Michigan DAPT is properly drafted as an
irrevocable trust, it can hold a Settlor’s assets, provide the Settlor with
accessibility to those assets as a beneficiary and give the Settlor a limited voice
on certain decisions, all while protecting the assets from the Settlor’s future
creditors. The new law provides that the Settlor’s creditors may not reach
assets transferred to the Michigan DAPT after a two year "statute of
limitations" starting when the assets are transferred to the trust, and only
with very limited exceptions such as a showing of a fraudulent transfer.
The Michigan DAPT is an extremely powerful
tool for both estate planning and asset protection.
You can find the statute starting here:
http://www.legislature.mi.gov/(S(h1wohgmcx4pmuek3smgzzpjl))/mileg.aspx?page=getobject&objectname=mcl-700-1041-new
