A client who has lived in one state for thirty years reasonably asks why her trust should be governed by the law of a state she has never visited. For most trusts it should not be. Home state law is usually adequate for a revocable trust, a grantor trust, or a family that wants a relative as trustee. South Dakota earns its place when the trust must last for generations, protect the person who funds it, keep family information private, or accumulate income free of state tax.
Arizona is a useful case study. Its 500-year and perpetual trust provisions carry an Attorney General's opinion that they likely violate the state constitution, and it has no self-settled asset protection statute. On directed trusts, decanting, quiet trusts, court file privacy and life insurance premium tax, the difference is one of degree, and on community property Arizona is the one that needs no help.
The full comparison is at turnipseed.law.
