About US

SDTA’s mission is to serve as the professional and trade association for South Dakota’s fiduciary services and trust industry by promoting, educating and supporting professionals and organizations involved in the trust industry in South Dakota.

The Story Behind SDTA

The South Dakota Trust story began in 1981 when an attorney from Wisconsin with a shrewd understanding of state tax law advised a family to move their trusts to South Dakota to maximize our State’s favorable regulatory laws on the sale of family owned business interests held in trusts. He noted that while Wisconsin had repealed its rule against perpetuity (“RAP”), thus allowing for perpetual trusts, he chose a state with no state income tax over unlimited duration.  The family took his advice and moved the trusts to South Dakota before selling the family owned business interests, and saved over $12 million in state income taxes.

The attorney commented that if South Dakota repealed its’ RAP, that benefit, combined with no state income tax would make South Dakota the top jurisdiction for personal trusts. In 1983, the opportunity for change presented itself.  During his first term, Governor Bill Janklow seized the opportunity to convince South Dakota legislative leaders to repeal South Dakota’s RAP.  This significant change began to open doors for South Dakota trust companies and banks to provide a significant added benefit to their customers.  The ensuing years of growth in South Dakota’s trust industry would more than support this conclusion.

Between 1983 and 1993 South Dakota, through its regional and local banks, were able to attract new trust assets from out of state.  In 1993, a trust officer at Norwest Bank, wrote an article about the advantages of South Dakota.  The article was published in Trust and Estates Magazine.  The article caught the attention of the CEO of Citibank’s trust and estate planning practice in New York, who later convinced Citibank to start a South Dakota chartered trust company. With Citibank’s international reach, South Dakota was a perfect place to situs trust for foreigners who were looking to move to the US because they could gift unlimited amounts into the trust and save state income tax and have the trust go on in perpetuity.

In 1996, the .com craze in the Silicon Valley started to take shape.  South Dakota was a perfect place to put illiquid stock with minority discounts because of the very low gift exemption.  Because the assets had no real value, the fees that trust companies could charge were nominal until the assets were sold or went through an IPO.  Because of this, banks and institutional trust companies didn’t want to hold the assets.  This gave way to the creation of the South Dakota directed trust statute.  This allowed banks and trust companies to hold these illiquid assets but reduce the risk of the concentrated stock positions by shifting the risk to a protector or investment advisor appointed in the trust document who was responsible for managing the assets.

SDTA Board Members

Antony Joffe

JESSICA BEAVERS

ABBIE RANSCHAU

PAT GOETZINGER

MIKE DEA

JOEL BLACK

MATTHEW TOBIN

MATTHEW MCMILLEN

HOME              ABOUT              JOIN              CONTACT US

Interested in becoming a member?