The One Hard Rule: At Least One Utah Trustee
Utah Code § 75B-1-303(2)(a)(ii) sets a single, mandatory requirement for the trustees of a Utah asset protection trust: at all times, at least one trustee must be a Utah resident or a Utah trust company. That's it — that's the entire trustee floor set by the statute itself.
This requirement doesn't mean every trustee has to live in Utah or be based here. It means at least one has to. A trust can have multiple co-trustees — an out-of-state family member, a trusted advisor, even the settlor — as long as one qualifying in-state trustee is in place at every moment the trust exists.
Why this matters beyond compliance. This is the requirement that actually makes the trust a "Utah" asset protection trust in a legal sense. It's what ties the trust to the state's favorable law and its short creditor-challenge windows under § 75B-1-307. If the in-state trustee position goes vacant — because an individual trustee moves away, becomes incapacitated, or resigns without a replacement — the trust risks falling out of compliance with no advance warning.
Can the Settlor Serve as Trustee?
Yes, with one important boundary. Section 75B-1-304(1) expressly allows the person who created and funded the trust — the settlor — to serve as a co-trustee or as an advisor to the trustee. The statute draws the line at a single point: the settlor may not be the one who determines whether a discretionary distribution will be made to the settlor. That decision-making authority has to rest with a different trustee.
Beyond that one limit, the settlor can still be meaningfully involved in the distribution process without disqualifying the trust. Under § 75B-1-304(2), a settlor may, without jeopardizing the trust's protections:
- Request a distribution from the trust;
- Consult with the other trustees about whether a distribution should be made;
- Exercise a right to consent to or veto a distribution, if the trust instrument gives the settlor that power;
- Sign the paperwork implementing a distribution as a co-trustee, once the other trustees have independently decided to authorize it; or
- Participate in authorizing a distribution the other trustees could have approved without the settlor's involvement anyway.
In practice, this means a common, fully compliant structure looks like this: the settlor serves as a co-trustee alongside a Utah resident or Utah trust company, and that other trustee holds the actual discretionary authority to decide whether and when the settlor receives a distribution.
The Settlor Can Wear Other Hats, Too
The statute goes further than just allowing co-trusteeship. Under § 75B-1-304, a settlor can retain several other roles without losing the trust's protection:
Investment Director
A settlor may retain the power to direct how trust assets are invested, or appoint someone else to do so, under Utah's Uniform Directed Trust Act (§ 75B-2-906). Investment authority is treated separately from distribution authority — controlling how the money is invested doesn't carry the same risk to the trust's protection that controlling distributions to yourself does.
Authority: § 75B-1-304(4).
Power to Appoint a Trust Protector or Advisor
A settlor may retain the authority, under the trust instrument, to appoint a nonsubordinate advisor or trust protector — someone not under the settlor's control — who can remove and appoint trustees, and who can direct, consent to, or disapprove distributions. This gives the settlor meaningful long-term oversight of who serves as trustee, without the settlor personally holding the distribution-decision power the statute reserves for someone else.
Authority: § 75B-1-304(3).
Consent-or-Veto Power Over Distributions
The trust instrument may give the settlor the power to consent to or veto a distribution outright. This is a real, substantive power over the trust's money — and the statute specifically allows it without disqualifying the trust from protection.
Authority: § 75B-1-304(5)(a).
Individual Trustee or Utah Trust Company?
Once you know the floor requirement, the practical question becomes which kind of in-state trustee to use.
| Option | Advantages | Watch out for |
|---|---|---|
| Individual Utah resident | Lower cost; personal relationship with the family; often a trusted friend, family member, or advisor. | Can die, become incapacitated, or move out of state — creating a gap in the in-state trustee requirement if no successor is named. |
| Utah trust company | Professional administration; institutional permanence; no risk of relocating out of state. | Higher ongoing fees; less personal than a family member or friend serving in the role. |
Many settlors address the individual-trustee risk by naming a successor in-state trustee or a Utah trust company in the trust instrument up front, so the trust never has a gap in coverage if the primary in-state trustee can no longer serve.
Example. Sarah creates a Utah asset protection trust and funds it with investment property. She serves as co-trustee alongside a Utah trust company, which holds sole discretion over any distributions to her. Sarah retains the power to direct how the trust's investments are managed and the authority to appoint a trust protector who can replace the corporate trustee if service quality declines.
This structure satisfies § 75B-1-303's in-state trustee requirement, keeps Sarah out of the one prohibited role (deciding her own distributions), and still gives her meaningful, statute-permitted control over investments and long-term trustee oversight.
Frequently Asked Questions
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A Utah trust company is a corporate fiduciary chartered or licensed to conduct trust business in Utah, such as a Utah-chartered trust company or the trust department of a bank authorized to act as a fiduciary in Utah. Using one instead of an individual Utah resident satisfies the same requirement under Utah Code § 75B-1-303(2)(a)(ii) and avoids the risk of the position going vacant if an individual trustee dies, resigns, or moves out of state.
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The trust needs a qualifying replacement in place without a gap, since Utah Code § 75B-1-303(2)(a)(ii) requires a Utah resident or Utah trust company trustee "at all times." This is why the trust instrument should name a successor Utah trustee or corporate trust company up front, and why many settlors choose a Utah trust company over an individual specifically to avoid this administrative risk.