As of July 1, 2014, Mississippi became the fifteenth state to allow the creation of a “self-settled asset protection trust.” The full text of the legislation may be found in Mississippi House Bill 846, the “Mississippi Qualified Disposition in Trust Act,” signed by Mississippi Governor Bryant on April 23, 2014. The legislation was effective July 1, 2014 and is codified as Sections 91-9-701 et seq. of the Mississippi Code of 1972. The Mississippi Qualified Disposition in Trust Act (“MQDTA”) is modeled after the Delaware Qualified Disposition in Trust Act and Tennessee Investment Services Trust Act.
MQDTA requires that a “qualified disposition” in trust be made pursuant to an irrevocable, written trust instrument that incorporates Mississippi law with respect to the validity, construction and administration of the trust. The trust instrument must contain a “spendthrift” provision that provides that the interest of the transferor or other beneficiary in trust property or income may not be transferred, assigned, pledged or mortgaged, voluntarily or involuntarily, prior to the distribution of trust property or income to the beneficiary. In addition, the transfer of property to the trust must not Continue reading