Spendthrift &Asset-Protection Trusts
A trust can shield an inheritance from creditors, divorce, and bad habits. These Arizona FAQs from our team cover spendthrift clauses, dynasty trusts, staggered distributions, and how to control how a beneficiary receives their share (7 questions).
Start with our guide
For the complete walkthrough of how Arizona spendthrift, dynasty, discretionary, and incentive trusts protect an inheritance from creditors, divorce, and bad habits under the Arizona Trust Code, read our complete guide. Then dig into the focused questions below.
Read the Arizona Spendthrift & Asset-Protection Trusts complete guideAll 7 questions in this topic
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What is a spendthrift trust, and how does it keep my beneficiary's creditors away from their inheritance in Arizona?
A spendthrift trust includes a provision under A.R.S. 14-10502 that prevents your beneficiary from giving away their trust interest and blocks most creditors from reaching it. Exceptions exist for child support, government claims, and federal tax obligations.
Read full answerIs there a way to set up a trust that protects my family's wealth for generations, not just my kids?
Yes. A dynasty trust is a type of trust designed to hold and grow wealth across multiple generations while avoiding estate and generation-skipping transfer taxes. Arizona allows trust interests to last up to 500 years under A.R.S. 14-2901.
Read full answerIf I inherit money or property, can my own creditors come after it in Arizona?
Inherited property is separate property in Arizona, but your own creditors can still reach it once you receive it. A spendthrift trust under A.R.S. 14-10502 offers stronger protection by shielding trust assets from creditor claims before distribution.
Read full answerHow do I make sure my child's inheritance is protected if they get divorced or sued?
Leave the inheritance in a trust with spendthrift provisions instead of giving it outright. This keeps the assets out of your child's name and protects them from divorce settlements, creditors, and lawsuits.
Read full answerMy child has addiction issues, how do I leave them an inheritance without enabling bad habits?
Use a discretionary trust with a professional trustee who controls when and how distributions are made. You can include sobriety requirements, incentive provisions, and structured distributions that provide financial support without enabling destructive behavior involving drugs or alcohol.
Read full answerI want to leave money to my kids, but I am worried one of them will waste it. Can I control how they receive it?
Yes. Setting up a trust lets you control exactly how and when each child receives their inheritance. You can stagger distributions by age, tie them to milestones, add spendthrift protections, or use an incentive trust to encourage responsible behavior instead of handing over a lump sum.
Read full answerCan I put conditions on an inheritance, like my child has to finish college or stay sober?
Yes. A trust lets you set conditions on a child's inheritance, such as completing college, passing a drug test, or reaching a certain age. There are two types of conditional gifts: condition precedent (must meet the requirement first) and condition subsequent (ongoing requirement). A trustee manages the funds until the beneficiary meeting the conditions.
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