Hawaii’s New Trust Law is “Dead on Arrival”

At the end of June, Hawaii Governor Linda Lingle signed a new trust law, hoping to attract trust business and increase Hawaii’s revenue. However, the new law most likely won’t be able to compete with South Dakota, Nevada, Delaware, or Alaska because it charges an unprecedented 1% excise tax on all assets moved into asset protection trusts. In addition, the law prohibits transfers of real property into the trusts and restricts the trusts to 25% of the grantor’s net worth. Estate planners predict that neither out-of-state individuals nor Hawaii residents will take advantage of the new trust law.

See Jerry Cooper, Don’t Count on Hawaii’s New Trust Law to Attract the Super-Rich, The Trust Advisor Blog, Aug. 21, 2010.