People who are creating an estate plan often want to ensure that future generations in their family are taken care of. One option for doing this is by establishing a trust, but it’s critical to choose the proper type. A dynasty trust is meant to provide the creator with a long-term way to pass assets from one generation to the next without having to deal with certain taxes, such as generation-skipping transfer taxes, gift taxes or estate taxes.
In Texas, a dynasty trust can last up to 300 years and can be funded with up to $13.99 million, as of 2025. While it may seem as though this is only an option for the ultra-wealthy, there isn’t any minimum amount required to establish a dynasty trust.
Limitations of a dynasty trust
One of the most important limitations to remember when establishing a dynasty trust is that it is an irrevocable trust. This means that the terms that are set will apply for generations to come without being changed. Because of this, the terms of the trust must be set carefully when the trust is created. In order to change an irrevocable trust, the court has to approve the changes or all named beneficiaries have to agree to the changes.
A dynasty trust can be an important component in an estate plan that’s meant to preserve wealth for future generations. Being able to get everything set up so it reflects the interests of the creator is critical. This can be complex, particularly with larger estates. Working with someone who understands the options in Texas may make this process easier.