Advantages of The Xenith Financial Spendthrift Trust

• Our Trusts were written to comply with Scott on Trust Law, the Restatement of Trusts, and the Internal Revenue Code. This was done so the Trust corpus would be protected from turn over orders by any court or judge, with the exception of fraudulent conveyance.

• The non-grantor designation exempts the Trust from any alter ego status that brings into action the management or beneficial enjoyment by the Settlor. If the creator of a Trust has management of the corpus, or is a beneficiary of the Trust, it becomes a so-called living trust which has limited benefits and no tax advantages or asset protection.

• In order to have asset protection, the Trust must be Irrevocable and non-grantor. This Trust separates the Settlor, or Creator, from the corpus of the Trust. When assets are irrevocably transferred to the Trust, they may never revert to the one who is making the endowment, or the Settlor of the Trust. Under these terms and conditions upon creation, legal separation has occurred and the corpus may not be breached by claimants of the Settlor.

• In order to serve the Beneficiaries of the Trust and protect the corpus, the Trust must be complex in nature, with terms and conditions that plainly and fully state the powers and limitations of the Trustee(s). Complex Trusts are governed by terms and conditions that may not be altered or changed by the Trustee(s). The purpose of the Trust is established once and for all time.

• The Spendthrift Provision of the Trust is the critical element of the document, in that, no Spendthrift Trust Corpus may be penetrated to reach the assets of that Corpus. Case law upholds this, and has upheld this over the many long years of its existence and will continue to uphold it. No judge or court may issue a turnover order against a properly constructed Spendthrift Trust. The sole exception to this rule of law is fraudulent conveyance to avoid judgment, and this applies to a Trust created after litigation has been filed, not before.

• The Discretionary terms and conditions of the Trust are established to insure the absolute and sole discretionary power of the Trustee in determining the distribution of the Corpus assets to the Beneficiaries of the Trust. If any single percent of the Corpus is designated to be held or distributed to one or more Beneficiary(ies), the Discretionary designation of the Trust would be invalid. This in no way would affect the asset protection but could adversely affect the taxable structure of the Trust.

• The Internal Revenue Code is explicit and clear with regard to the Discretionary nature of a Trust, plainly stating that if a fiduciary has the sole and absolute authority to designate something as Extraordinary Dividends or Taxable Stock Dividends, and that designation is paid to the Corpus of the Trust and not subject to distribution, this is not income to the Trust according to Rule 643. Another advantage to this Trust is that any asset held in the Corpus of the Trust, when sold, is not subject to capital gains taxes.

• Thus, all our Trusts were created and written to be Non-Grantor, Irrevocable, Complex, Discretionary, Spendthrift Trusts and Copyrighted for our use.