South Dakota continues to lead the nation in estate planning innovation, thanks in part to its ability to offer uniquely defined trust roles. Family and tax advisor roles provide families with more flexibility, control and guidance in managing generational wealth. In this article, we discuss the differences and benefits of both roles.
Family advisor
A family advisor is a financial professional who helps manage and preserve a family’s wealth across generations. Their role is viewed as holistic, aligning financial planning with the family’s values and long-term goals. While they do not have fiduciary authority over trust assets, they can:
- Provide general advice without fiduciary duty
- Recommend changes to decision-makers
- Determine who receives notifications
This role allows families to maintain influence over trust administration without needing to be in direct control.
Tax advisor
A tax advisor focuses on minimizing tax liabilities with their expert knowledge of federal and state tax codes. This is typically a Certified Public Accountant (CPA) or tax specialist, who may or may not be a fiduciary. Their responsibilities include:
- Offering strategic tax planning
- Ensuring compliance with evolving regulations
- Advising on tax-efficient trust structures
This role helps ensure families consider tax consequences now and in the future.
Why these roles are beneficial
These roles are not mutually exclusive. In fact, the most effective strategies often involve both a family advisor and a tax advisor working in collaboration. Together, they can provide a comprehensive approach to wealth preservation, governance and tax efficiency.
South Dakota’s flexible statutes and the recent addition of these specialized roles are a few reasons it remains a top jurisdiction for trust planning.
Give me a call to learn more about South Dakota trusts.
South Dakota trust services are provided by BTC Trust Company of South Dakota, a wholly-owned subsidiary of Bankers Trust Company.
Bankers Trust Company and its affiliates and their representatives do not provide tax or legal advice. You should consult with your tax and legal advisors regarding your unique situation and needs before deciding on an estate plan that would work best for you and your family.
