Utah Domestic Asset Protection Trusts (DAPT): Complete, Statute-Cited Guide | Cutler Riley

Utah Asset Protection

Utah Domestic Asset Protection Trusts (DAPT): The Complete, Statute-Cited Guide

A Utah DAPT is an irrevocable, self-settled spendthrift trust that can lawfully shield a settlor’s assets from most future creditor claims— if it satisfies Utah’s statute and does not constitute a voidable transfer under UVTA. This guide covers requirements, timing bars, trustee rules, drafting traps, the 2024 Title 75B renumbering, and practical checklists—with direct links to the controlling law.

Educational content, not legal advice. Laws change; facts matter. Book a free consultation.
Jump to: Framework & 2024 renumbering (Title 75B) What Utah’s DAPT statute does All required elements (checklist) What the settlor can still do Governing law & jurisdiction Seasoning periods & 120-day notice UVTA interaction (voidable transfers) UTC background (spendthrift/settlor rules) Common failure points Permitted distribution designs Practical build checklist Quick comparison table Utah DAPT FAQs Related resources

Framework & 2024 Renumbering (Title 75B)

Utah created a DAPT regime in 2013 and later reorganized trust statutes in 2024, introducing Title 75B (Trusts). Older DAPT citations (e.g., § 25-6-14) now map to Title 75B, with a transition clause confirming continued validity of prior references: see Utah Code § 75B-1-102 (Transition clause).

What Utah’s DAPT Statute Does

When the statute’s conditions are met, a creditor of the settlor may not satisfy claims from the settlor’s transfers to, or beneficial interest in, the DAPT; may not compel distributions; and may not attach a discretionary distribution before it is paid. After a distribution is actually paid to the settlor, a creditor may pursue that amount. Historical text: former § 25-6-14; successor location: § 75B-1-302 (Asset protection trust).

All Required Elements (Meet every one)

  1. Utah governing law & DAPT election: instrument states Utah law governs and that it’s established under the Utah DAPT section. (Former § 25-6-14(5)(a); successor § 75B-1-302.)
  2. Utah trustee: at least one Utah resident trustee or Utah trust company (see § 7-5-1). (Former § 25-6-14(5)(b); successor § 75B-1-302.)
  3. Spendthrift against settlor interest/transfers; enforceable via Bankruptcy Code § 541(c)(2): (Former § 25-6-14(5)(c); successor § 75B-1-302.)
  4. No unilateral revocation/amendment/termination or withdrawals by settlor without consent of an adverse party. (Former § 25-6-14(5)(d); successor § 75B-1-302.)
  5. No mandatory distributions to settlor (subject to permitted patterns). (Former § 25-6-14(5)(e), (7)(f); successor § 75B-1-302.)
  6. No side agreements granting non-authorized access; only what the instrument authorizes. (Former § 25-6-14(5)(f).)
  7. Child support protections: notice 30 days before settlor distributions; settlor not in default when funding. (Former § 25-6-14(5)(g)–(h).)
  8. Solvency & intent constraints: funding can’t render settlor insolvent; no intent to hinder/delay/defraud a known creditor; no contemplated bankruptcy; assets are lawfully owned. (Former § 25-6-14(5)(i)–(l).)
  9. Affidavit at each transfer (title/authority, solvency, pending actions, child-support status, no bankruptcy contemplated, lawful funds). (Former § 25-6-14(5)(m).)

Consequences of noncompliance: miss items (a)–(g) ⇒ no protection for any assets; miss items (h)–(m) ⇒ only that transfer loses protection. (Former § 25-6-14(6).)

What the Settlor Can Still Do (and keep protection)

Utah permits numerous retained roles/powers without destroying protection: serve as co-trustee (not deciding discretionary distributions); appoint advisors/protectors to hire/fire trustees or consent to distributions; hold investment director authority; exercise a veto over distributions; retain a nongeneral testamentary power of appointment; allow distributions under an ascertainable standard; authorize percentage distributions not exceeding income (see 26 U.S.C. § 643(b)); and retain interests in QPRT/GRAT/CRAT/CRUT (see § 2702, § 664). (Former § 25-6-14(7)(a)–(g); successor § 75B-1-302.)

Governing Law & Jurisdiction

Choice-of-law under Utah’s UTC (§ 75-7-107; see 75B renumbering) plus the DAPT statute’s jurisdiction provisions: Utah courts have exclusive jurisdiction over actions related to transfers to a Utah DAPT. (Former § 25-6-14(11)(a)–(b); successor § 75B-1-302.) Transition clause: § 75B-1-102.

Seasoning Periods & 120-Day Notice Options

  • Two-year / one-year discovery rule for pre-existing creditors claiming actual intent: must also show a specific pre-transfer claim or action tied to pre-transfer conduct. (Former § 25-6-14(9)(a)–(a)(ii).)
  • 120-day creditor notice method: mail to known creditors or publish for unknown creditors for 3 consecutive weeks per § 45-1-101. Bar applies to claims not presented within 120 days. (Former § 25-6-14(9)(b), (10).)

These DAPT-specific bars operate alongside UVTA time limits in § 25-6-305.

UVTA Interaction (Uniform Voidable Transactions Act)

Even a compliant DAPT can be unwound if a transfer is voidable under UVTA:

  • Actual intent & badges of fraud (present/future creditors) — § 25-6-202
  • Present creditor constructive-fraud test — § 25-6-203
  • Remedies (avoidance, attachment, injunction, receiver, etc.) — § 25-6-303
  • Time limits — § 25-6-305

UTC Background (Spendthrift & Settlor-Creditor Rules)

Utah UTC context (for non-DAPT trusts and general creditor rules):

Utah’s DAPT statute creates an exception to the default settlor-creditor rule when all DAPT conditions are satisfied (see successor § 75B-1-302).

Common Failure Points (What will sink a Utah DAPT)

  • Missing mandatory clauses (Utah governing law; Utah trustee; spendthrift vs settlor; no unilateral revocation; no mandatory distributions; child-support notice). Result: protection fails for all assets. (Former § 25-6-14(6)(a).)
  • Solvency/intent/bankruptcy/affidavit defects for a specific transfer. Result: only that transfer loses protection. (Former § 25-6-14(6)(c).)
  • UVTA actual-intent or constructive-fraud claims within time limits. (See § 25-6-202, § 25-6-203, § 25-6-305.)
  • Child-support noncompliance (notice/default). (Former § 25-6-14(5)(g)–(h).)

Permitted Distribution Designs (that keep protection)

  • Independent trustee with full discretion over distributions.
  • Settlor distributions under an ascertainable standard (e.g., HEMS).
  • Unitrust/percentage distributions not exceeding income (see 26 U.S.C. § 643(b)).
  • Retained interests consistent with QPRT/GRAT/CRTs (see § 2702, § 664).

See former § 25-6-14(7)(c)–(g); successor § 75B-1-302.

Practical Build Checklist (Utah-Specific)

  1. Express Utah governing law + DAPT election (former § 25-6-14(5)(a); successor § 75B-1-302).
  2. At least one Utah trustee (resident or Utah trust company; § 7-5-1).
  3. Strong spendthrift vs settlor with § 541(c)(2) reference (former § 25-6-14(5)(c)).
  4. No unilateral revocation; use adverse party consent (former § 25-6-14(5)(d)).
  5. No mandatory distributions to settlor (former § 25-6-14(5)(e), (7)(f)).
  6. Child-support protocols (notice/default) (former § 25-6-14(5)(g)–(h)).
  7. Settlor affidavit at each funding (former § 25-6-14(5)(m)).
  8. Consider 120-day notice to shorten windows (former § 25-6-14(9)–(10); § 45-1-101).
  9. Evaluate UVTA risk & time limits (§ 25-6-202, § 25-6-203, § 25-6-303, § 25-6-305).

Quick Comparison (Utah DAPT vs Standard Irrevocable Trust)

Topic Utah DAPT Standard Irrevocable (Third-Party)
Settlor as beneficiary Allowed if statute satisfied (successor § 75B-1-302) Generally no protection for settlor (§ 75-7-505)
Spendthrift vs settlor Effective if DAPT rules met Not effective against settlor’s creditors
Utah trustee required Yes No (not by statute)
Affidavit/solvency requirements Yes, each transfer (former § 25-6-14(5)(m)) Typically no
UVTA exposure Yes (voidable transfer analysis) Yes (debtor’s transfers subject to UVTA)

Utah DAPT FAQs

Is a Utah DAPT bulletproof?

No. It is strong when built/administered correctly, but still subject to UVTA challenges and the statute’s timing bars/exceptions. See § 25-6-202, § 25-6-203, § 25-6-305, and former § 25-6-14(9)–(10).

Can I be my own trustee?

You can serve as co-trustee or hold certain powers (investment director, veto, nongeneral testamentary POA), but you cannot decide discretionary distributions to yourself. (Former § 25-6-14(7)(a)–(e); successor § 75B-1-302.)

How fast do protections “season”?

Utah offers (a) a 2-year / 1-year discovery bar for pre-existing creditors, and (b) a 120-day creditor notice option (mail/publish). See former § 25-6-14(9)–(10) plus UVTA limits in § 25-6-305.

What about child support or alimony?

The statute builds in child-support notice/default protections; courts can scrutinize distributions for domestic support obligations. (Former § 25-6-14(5)(g)–(h).)

Do I still need a broader estate plan?

Yes. Pair your DAPT with core documents and proper titling for a complete plan: Revocable Living Trust, Will, Power of Attorney, Health Care Directive, Property Deed & Trust Funding.