Why More Utah Business Owners Are Choosing Trusts Over Wills
You’ve built a successful business in Utah. You’ve invested time, money, and passion into making it thrive. But have you thought about what happens to your business after you’re gone? This is where estate planning comes in. More and more Utah business owners are choosing trusts over wills to protect their hard work. Why? Because trusts offer benefits that wills simply can’t match.
At John Park Law, our estate planning attorneys are licensed in Nevada, California, and Utah, and we’re here to help you safeguard your business and secure your legacy. With decades of experience, we provide the trusted guidance you need to plan for the future with confidence. Contact us today!
Wills vs. Trusts: Understanding the Basics
If you’re a business owner, deciding how to pass down your assets isn’t just about personal wealth—it’s about keeping your business running smoothly. A will is a common estate planning tool, but it only takes effect after you pass away. It also has to go through probate, a court-supervised process that can be expensive, time-consuming, and public. Plus, a will primarily covers personal assets, meaning your business could end up in legal limbo.
With a trust, you stay in control—not just now, but long after you’re gone. One of the biggest benefits? Your business avoids probate entirely. That means no long court battles or delays—your assets move quickly and privately, just the way you intended. Trusts also let you set clear instructions for who takes over and how your business is managed, making them a better choice for business owners who want a seamless transition.
Why Utah Business Owners Are Making the Switch
As a business owner, you’ve put years of effort into building something valuable. But what happens to your business when you’re no longer around? If you rely only on a will, your business assets could get tied up in probate, leading to delays, legal costs, and uncertainty for your family and partners.
That’s why many Utah business owners are making the switch to trusts, which offer greater protection, efficiency, and control over their legacy.
Avoiding Probate Hassles
In Utah, probate can be a long and complicated process—sometimes dragging on for months or even years. And while everything is tied up in court, your business assets could be frozen, making it tough (or even impossible) for your company to function. A trust helps you skip this hassle completely. It lets your business transfer to the right people right away, without delays or court interference, so operations can continue smoothly.
Protecting Business Continuity
One of the biggest risks of poor estate planning is disputes over ownership. A trust lets you set clear instructions on who will manage your business, reducing the chance of legal battles among heirs or partners. This stability is crucial for keeping operations running smoothly and protecting employees, customers, and stakeholders.
Tax Benefits & Asset Protection
Certain types of trusts can offer tax advantages, potentially reducing estate taxes. Additionally, some trusts provide asset protection, shielding your business from creditors, lawsuits, or financial risks. This ensures that your hard-earned success stays within your family or designated successors.
More Control Over the Future
Trusts allow you to set specific terms for how your business assets are managed and distributed. This means you can ensure your business is handled according to your wishes, even if you’re no longer around.
Common Misconceptions About Trusts
- “Trusts are only for the wealthy.” In reality, trusts can benefit businesses of all sizes by providing control and protection.
- “A will is sufficient for my business.” While wills are essential, they may not offer the same level of detail and protection for business assets as trusts do.
- “Trusts are too complicated.” With the guidance of experienced professionals, setting up a trust can be straightforward and tailored to your specific needs.
Choosing the Right Type of Trust for Your Business
When setting up a trust for your business, it’s important to choose the right type based on your goals. Different trusts offer varying levels of control, protection, and tax benefits. Here are some key options to consider:
Revocable vs. Irrevocable Trusts
- Revocable Trusts – A revocable trust is a great option if you want to keep control over your assets while you’re alive. This type of trust allows you to make changes, add or remove assets, or even dissolve the trust entirely if your circumstances change. It’s a popular choice for business owners who want a flexible estate plan that can adapt over time. However, the key trade-off is asset protection. Because you still have control over the trust, the assets inside it aren’t fully protected from creditors or legal claims. If you’re looking for stronger protection against lawsuits or financial risks, an irrevocable trust might be a better fit.
- Irrevocable Trusts – Once established, these trusts generally cannot be changed. While they require giving up some control, they offer stronger asset protection and can provide significant tax advantages. This type of trust is ideal for business owners looking to shield their assets from creditors and reduce estate taxes.
Business Succession Trusts
A business succession trust ensures a smooth transfer of ownership when you step down or pass away. It allows you to specify who will take over the business and under what conditions, reducing the risk of legal disputes or operational instability. This type of trust is particularly useful for family businesses or partnerships.
Asset Protection Trusts
Running a business comes with risks—lawsuits, creditors, and unexpected financial challenges can put your hard-earned assets in jeopardy. A Utah Domestic Asset Protection Trust (DAPT) is a powerful tool that helps shield your business from these threats. By placing your business assets in this type of trust, you create a legal barrier that makes it much harder for creditors to claim them.
Think of it as a financial safety net—whether you’re facing a lawsuit, business debt, or other financial risks, an asset protection trust can keep your company secure and running smoothly. However, setting up this kind of trust requires careful planning. Not all assets qualify for protection, and Utah law has specific rules about how and when the trust must be established.
An experienced Utah estate planning attorney can safeguard your business, minimize financial risks, and ensure that your company stays strong for years to come.
Let’s Talk! Call Our Utah Estate Planning Lawyers Today
At John Park Law, our Cottonwood Heights wills and trusts lawyers have extensive experience in estate planning, particularly in setting up trusts for business owners. Our deep understanding of Utah laws ensures that your trust is both effective and compliant.
With years of dedicated service, we’ve assisted numerous Utah business owners in safeguarding their legacies. Our clients trust us to provide personalized and effective legal solutions.
Don’t leave your business’s fate to chance—take the necessary steps today to secure your legacy. Call our estate planning law firm at 801-701-3330 or fill out our confidential contact form.
John Park is a highly experienced attorney in estate planning, probate, business law and guardianship to help people organize the elements of their lives through careful estate planning and asset protection measures.