Facebook. The Florida Asset Protection Trust (“FLAPT”)is an irrevocable trust that is sitused (at least initially), in the state of Florida but which is highly flexible to meet the needs of the trusts’s creator (called the Settlor) over time. The Settlor or the Settlor’s family members and/or trusted friends can serve as the trustee so no expensive out of state corporate trustee is needed.
By: Florida Estate Planning Attorney Thomas Upchurch of Upchurch Law – Daytona Beach, FL.

Under Florida law, a spendthrift provision in a trust does just that – protects the beneficiary’s inheritance from the beneficiary’s spendthrift ways.

This type of trust is best suited for individuals who may be a financial danger to themselves if given unfettered control or may be subject to being taken advantage of or exploited. Creditors of the beneficiary generally cannot reach the funds in the trust, and the funds are not actually under the control of the beneficiary.

Florida courts have noticed as well and have decided that the practice is void as against public policy.

1993) (“A settlor cannot create for himself a spendthrift trust to avoid creditors.”); 55A FLA. Spendthrift clauses can be confusing to trustees. Such a provision sets forth special language preventing creditors from attaching or “taking away” the interest of a beneficiary named in a Trust.Florida law enforces spendthrift provisions so long as they apply to both voluntary and involuntary transfers. Asset protection is an important aspect of Florida Estate Planning and is a delicate process for Florida residents. In some states such as Nevada and Alaska, they allow what is known as a Domestic Asset Protection Trust that protects the trust against creditors. (1) A spendthrift provision is valid only if the provision restrains both voluntary and involuntary transfer of a beneficiary’s interest. A spendthrift trust is an irrevocable living trust that's overseen on an ongoing basis by a trustee, from the time of its inception and continuing on after the death of the grantor. Irrevocable Trusts in Florida [Overview, Pros and Cons] ... by creating an irrevocable spendthrift trust and naming yourself as beneficiary, you can enjoy the benefits of property that is effectively immune to creditor claims. alimony or child support) against a delinquent spouse or parent. 736.0502 Spendthrift provision. Spendthrift trusts are usually made by a grantor who wants to leave property to a beneficiary but is worried that the beneficiary won’t use the property wisely or that he or she might get into trouble with creditors. Google+. A “spendthrift” is a term for an individual that spends more than he or she has.
spendthrift clause: n. a provision in a trust or will that states that if a prospective beneficiary has pledged to turn over a gift he/she hopes to receive to a third party, the trustee or executor shall not honor such a pledge.

Many trusts are closed down after their grantor dies and their assets have been distributed to their beneficiaries, but a spendthrift trust remains up and running.

The general idea with a Florida Spendthrift clause is that the beneficiaries cannot assign their interest in the trust to a creditor ( voluntarily or involuntarily) Here is the test found in a typical clause under … The court noted that “spendthrift provisions have long been recognized as valid in Florida” and Florida Statutes 736.0501-.0507 provide for the enforcement of spendthrift trusts. The Basics of a Florida Spendthrift Trust: (Photo Credit: "Treasure chest" by Timitrius is licensed by CC by-SA 2.0). Most well-drafted Trusts contain a spendthrift provision-also sometimes called a restraint on alienation provision. This subsection does not apply to any trust the terms of which are included in an instrument executed before the effective date of this code. Thus, the Zlatkisses were unsuccessful in their attempt to have the trust repay Steinmetz’s debt to them. 736.0502 Spendthrift provision.

A spendthrift trust is an irrevocable living trust that's overseen on an ongoing basis by a trustee, from the time of its inception and continuing on after the death of the grantor.

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