Building a Family Legacy Through Dynasty Trusts
How long-term trust structures keep wealth protected, productive, and in the family for generations
Imagine your great grandchildren paying their mortgage interest back to your family, not a bank. That is the power of a well built dynasty trust, a structure we design to keep the family together by keeping the money together.
At Costaras Law, we help families transform wealth into an enduring system that funds opportunity, protects assets from threats, and minimizes taxes. If your estate faces potential estate tax exposure or you want a disciplined way to support multiple generations, a Dynasty Trust or a Domestic Asset Protection Trust may be the right fit.
What Is a Dynasty Trust?
A long-term trust designed to preserve and grow family wealth across multiple generations
A dynasty trust is an irrevocable trust designed to last for generations. Think of it as a family bank. The trust holds and invests principal, distributes income under clear rules, and keeps capital working for your heirs.
- Purpose: fund your family for generations and create a legacy
- Structure: assets grow inside the trust, typically under a conservative investment policy
- Access: heirs can receive distributions under guidelines you set
- Longevity: designed to endure well beyond your lifetime
A common model we use with clients is to target steady growth while limiting withdrawals. For example, a portfolio compounding at 7 percent while distributing up to 5 percent can grow the principal over time. If the full 5 percent is not needed, it can be reinvested, accelerating compounding across decades.
What Is a DAPT?
An irrevocable trust that protects assets from future creditors while maintaining compliant access
A Domestic Asset Protection Trust is also an irrevocable trust, but the focus is lifetime asset protection. With proper setup in a favorable jurisdiction, a DAPT can move assets outside your personal estate and away from many creditor claims. The result is a strong shield against lawsuits and other liabilities, while still allowing you to outline how funds may be used.
- Purpose: protect your assets during your lifetime
- Benefit: separates assets from personal creditors and claims
- Planning fit: often used when there are no heirs or when the priority is protection first
Dynasty Trust vs. "Just" an Irrevocable Trust
Understanding the key differences in duration, tax efficiency, and generational impact
Dynasty trusts and DAPTs are types of irrevocable trusts. Irrevocable simply means the trust terms are fixed once established, and the trust becomes a separate legal and tax entity. Within the irrevocable family are many proven designs that the IRS recognizes, each with a specific purpose.
At Costaras Law, we favor tried and true structures that have stood the test of time, then tailor them to your goals.
SLAT
Spousal Lifetime Access Trust
GRAT
Grantor Retained Annuity Trust
ILIT
Irrevocable Life Insurance Trust
CRAT
Charitable Remainder Annuity Trust
Dynasty Trust and DAPT
Types of Irrevocable Trust
When Does This Planning Make Sense?
Key financial and family circumstances where advanced trust planning provides the greatest value
These trusts are especially compelling when:
- Your estate may exceed the federal estate tax exemption
- You hold rapidly appreciating assets or concentrated positions
- You want to protect assets from future creditors or lawsuits
- You want a disciplined system to guide heirs and preserve capital
- There are special needs or public benefits considerations in the family
We will walk you through whether the benefits justify the ongoing administration, such as annual trust tax filings and trustee oversight. For many families, modest maintenance is outweighed by tax savings, liability protection, and long term control.
Why Past Clients Trust Costaras Law
Discover How They Found It A Simple and Easy Process
Jan C.
Happy Grandma
Attorney Nicholas Costaras prepared my Will and Estate Planning documents. He made the process simple, easy, and straightforward for me. If you need to get your Will or Estate Plan in order, you'll love having him on your side!
Amanda M.
Entrepreneur & Mom
Mr. Costaras is a pleasure to work with. He is patient, highly knowledgeable, and an expert at what he does. He helped me prepare my documents quickly and efficiently. He is a rare gem in the world of law. Anticipate exceptional service.
Debora Z.
Retired & Loving It
Attorney Costaras prepared a full Estate Plan for me. He explained the difference between a Revocable Living Trust and a Last Will & Testament. Thanks to his help, I now have my Estate Planning in order. I highly recommend him!
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