Nevada
A direct competitor to South Dakota and Delaware for trust business. No state income tax, a robust Domestic Asset Protection Trust statute, a 365-year perpetuities cap, the NING trust as a California-resident planning tool, and the longest established casino-state entity infrastructure.
Why this jurisdiction matters
Nevada has built its trust law over the past two decades to compete with South Dakota and Delaware. Asset-protection-trust provisions, perpetuities reform, directed-trustee statutes, and decanting authority are all available. Combined with no state individual income tax, Nevada is the most natural trust-situs choice for California residents seeking to avoid California's connection-based trust-income-tax claims.
The relevant tax regime
- No state individual income tax. Nevada imposes no personal income tax. Non-grantor trusts sited in Nevada are not subject to Nevada income tax.
- No state estate or inheritance tax.
- Commerce Tax. A state-level entity tax applied at gross-receipts above $4 million threshold, with rates varying by industry. Small holding entities generally below threshold.
- State sales tax. 6.85% state rate; combined rates approach 8.4% with local additions.
- Modified business tax on wages paid by Nevada employers; not directly relevant to passive trust structures.
Registration or residency mechanics
Trust situs requires a Nevada trustee, administration in Nevada, and incorporation of Nevada choice-of-law provisions. The Nevada Asset Protection Trust under NRS 166 requires defined statutory elements, including a Nevada-resident trustee, qualified statutory affidavit of non-creditor avoidance, and a two-year statute of limitations on creditor claims for transfers (one of the shortest in the U.S.).
Reporting and disclosure
Trust records private. LLC member information not publicly disclosed. CTA BOI reporting applies. Nevada permits "silent" provisions in trusts.
The substance question
The NING trust (Nevada Incomplete Non-Grantor Trust) is the canonical California-defection technique. A California resident transfers appreciated securities to a Nevada non-grantor trust with discretionary distribution provisions; the trust is not a grantor trust (avoiding §674-style retained powers) but the transfer is incomplete for gift-tax purposes (preserving estate inclusion at lower cost). Income earned by the trust is taxed federally (at compressed trust rates) but not by California. The IRS issued PLR 2013-10-002 and successors recognizing the framework; California has challenged certain structures, with mixed results.
Recent changes
Nevada continues to refine trust law. The 2023 legislative session extended decanting authority and refined directed-trustee provisions. The CTA BOI reporting applies as of 2024.
Common asset classes parked here
- NING trusts for California-resident appreciated-asset holdings.
- Domestic asset-protection trusts under NRS 166.
- Dynasty trusts; 365-year perpetuities cap.
- LLC formation for non-tax-driven entity needs.
- Family-office support entities.
Primary Sources
- Nevada Revised Statutes ch. 163, 164, 165, 166.
- NRS 166 (Spendthrift Trust Act of Nevada).
- NRS 111.1031 (rule against perpetuities for personal property trusts; 365 years).
- PLR 2013-10-002 and successors (non-grantor incomplete gift trust treatment).
- Nevada Department of Taxation — tax.nv.gov.
Reviewed May 2026