As Florida residents may know, some states allow noncharitable trusts to protect certain assets for a limited time or in perpetuity. This type of trust might be useful to protect domestic assets or provide for a pet.
Noncharitable purpose trusts offer some features of other trusts, such as naming a trust protector with the ability to administer the trust in the way the grantor wishes. However, no beneficiary is named in an NCP trust. The administrator may make changes when necessary, and some states limit the time for this type of trust to 21 years while others allow a dynastic trust with unlimited duration. One important aspect when establishing an NCP trust is whether state law where the grantor resides allows the time of service for the NCP device to run for the necessary time period to accomplish its purpose.
There are various reasons for setting up an NCP trust. However, some states only allow this type of trust to care for a pet or to provide for an honorary trust. However, states that have a 21-year limitation on NCP trusts for pets may not provide enough time to care for an animal with a longer lifespan. Other states offer provisions to extend a pet trust to cover the lifetime of the pet. NCP trusts may be used in some states for other purposes and may extend to royalties, maintenance of personal property, digital assets, gravesites and other items.
An individual interested in this type of trust may benefit by speaking to an attorney. The attorney may offer insight into the types of assets that may be included in an NCP trust and assist in structuring the device, allowing it to be tailored to the purposes of the grantor.