South Dakota is rated the top privacy state in the U.S. for trusts because of its “Automatic Total Seal in Perpetuity” for all court matters involving trusts and “Quite Trust” laws. If privacy is important to you, South Dakota offers the best options available.
Privacy and Total Seal in Perpetuity
South Dakota’s privacy statute provides for a total seal forbidding the release of trust information, including names of settlors, beneficiaries, and the contents of a trust, to the public during litigation. Most states do not have privacy statutes specific to trusts and, as such, privacy is not mandated or guaranteed by law as it is in South Dakota.
To the contrary, courts in those jurisdictions consider requests to seal the record on a case by case basis, after the commencement of litigation. Such requests can and are denied.
Similar to that of Alaska and Nevada, Delaware gives the court discretion over whether to seal trust information. Even if a Delaware court grants the seal, the information is only protected for three years. This is a major departure from South Dakota’s statute that seals trust information from the public forever without the need to petition for a court degree.
Quiet Trusts
Most states require trustees to inform a beneficiary of his or her beneficial interest in a trust at the age of 18. South Dakota law grants the settlor, trust protector, and the investment/distribution advisor the power to expand, restrict, eliminate, or modify the rights of the beneficiaries to discover information about a trust.