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A Better Partnership


Dec 2016
December 12, 2016

Michigan continues to modernize trust laws, authorizes Domestic Asset Protection Trusts

Gov. Rick Snyder has signed into law two bills that will continue the state’s move to modernize its trust laws by allowing asset protection trusts for the first time in Michigan’s history.

It’s important to understand the historical context for Public Act 330, which establishes the Qualified Dispositions in Trust Act, and its companion, Public Act 331, which amends the Uniform Fraudulent Transfer Act. Like the majority of states, Michigan has never allowed people to create and fund an irrevocable trust, make themselves the beneficiary of the trust and simultaneously prevent the creditors of the trust creator from reaching the assets.

This new legislation, signed into law on December 8, reverses common law. When the requirements of the statute are met, this law will allow someone to create what are known as domestic asset protection trusts (DAPTs), which can be funded with property and made irrevocable – all while retaining the ability to benefit from those assets and simultaneously protecting the assets from the trust creator’s creditors. DAPTs are only legal in 15 states – until Michigan made room for it last week.

Together, the two bills combine to give Michigan residents another tool for transferring and protecting their assets from creditors, including tort creditors, effective March 8, 2017. For individuals seeking to protect a portion of their property from creditors, Michigan’s new Qualified Dispositions in Trust Act represents an important development in the law.

If you are interested in learning more about asset protection trusts, contact Mark K. Harder at or 616.396.3225.

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