Rule Against Perpetuities (RAP)

Great news for high-net-worth individuals and families in South Carolina: You now have the ability to direct what happens to your property for much longer after your death. Previously, long-term estate planning had an effective limit of 90 years, or about three generations. Now, South Carolina residents can create trusts to protect and manage assets for up to 360 years – roughly a dozen generations.

This change went into effect in May 2025 when Gov. McMaster signed H.3432 into law. The bill extended the “wait-and-see” vesting period for future nonvested property interests and powers of appointment from 90 years to 360 years under the state’s Rule Against Perpetuities (RAP) laws. See South Carolina Code Sections 27-6-20 and 27-6-40.

This extension makes South Carolina competitive with other trust-friendly states like Tennessee, South Dakota, and Delaware, potentially attracting more high-net-worth families and trust businesses. (This is likely why H.3432 passed both the House and the Senate unanimously.)

For high-net-worth individuals and families, this change doesn’t affect the what, just the how long of family dynasty estate planning. But planning that far into the future comes with its own challenges. Below, we’ll look at the basics and benefits of dynasty estate planning, then at three things to watch out for.

The Basics and Benefits of (Very) Long-Term, Multi-Generation Estate Planning

The Basics of the RAP: Curbing “Dead-Hand Control”

The Rule Against Perpetuities originated in 17^th Century England as a way to prevent long-term “dead-hand control,” when a deceased person directs or controls what happens to his or her property from the grave through a will or trust. This helped keep land marketable and transferable while limiting the power of family dynasties.

The RAP came to the U.S. as part of the common law with the same intention. However, it’s evolved over the years, trending in favor of individual property owners. The majority of states have extended the length of time individuals can direct what happens to their property after death – South Carolina included. (You can read more about the history of the RAP in South Carolina here.)

The RAP in South Carolina

South Carolina’s Rule Against Perpetuities applies to any nonvested future interest or power of appointment, whether that’s created through a trust, will, or other legal instrument. In practice, though, the RAP primarily applies to trusts, which are the best instruments for multi-generational estate planning.

Assets in trusts may enjoy the following protections in South Carolina, depending on how the trust is drawn up:

• Avoidance of estate tax
• Avoidance of generation-skipping transfer tax (GST tax)
• Protection from creditors
• Protection from lawsuits
• Protection from divorce
• Protection from any individual owner’s bad decisions

An individual beneficiary may enjoy the advantages of the assets during the life of the trust according to its terms, such as the right to live in a property, to receive income generated by the trust’s investments, or have the trust pay for HEMS.

The 360-year clock starts ticking when a future interest or power of appointment is created, either when an irrevocable trust is funded or when a revocable trust becomes irrevocable upon the death of the grantor/settlor. By the end of the 360-year period, any nonvested property interests or powers of appointment must either vest or terminate. Any assets that then pass into the beneficiaries’ personal estates are once again subject to estate taxes, creditors, and more.

The Realities of (Very) Long-Term, Multi-Generation Estate Planning: What to Watch Out For

The benefit of the 360-year time frame is simply that the assets are protected for much longer than previously allowed under state law. But planning so far into the future presents its own potential pitfalls. Here are three considerations before drawing up a dynasty trust.

Watch Out 1: Inflexibility. Flexibility in Your Trust is a Must.

Imagine it’s the year 1666 and you’re creating a legal document to direct what will happen to your property for the next 360 years. Could you even imagine how much the world would change? Would the plans you developed in 1666 make sense in the year 2026?

That’s one of the big challenges of creating a trust that’s valid for 360 years into the future: It’s impossible to know what life will look like in 2386. For this reason, you must ensure that your trust is flexible enough to meet beneficiaries’ changing needs over the coming centuries.

This could mean provisions of the trust:

• Give future beneficiaries special powers of appointment so they can (within limits) direct which assets should go to whom
• Give the trustee(s) powers to invest, manage, or sell assets as needed to carry out the purpose of the trust
• Allow decanting, restructuring, mergers, and divisions
• Use percentages or shares to determine distributions rather than fixed currency amounts
• Address family-specific circumstances (to discuss with your estate planning attorney)

Avoid overly restrictive objectives and terms in the trust such as:

• “This trust is to preserve the family home”
• “Never sell the land”
• “Invest only in bonds rated AAA”

Restrictive terms like these seem to make sense now, or even over the next five years, but could be obsolete or counter to the purpose of the trust in 360 years.

Watch Out 2: Choice of Trustee. Trustee Succession Is Crucial.

Choice of trustee is crucial no matter the trust, as the trustee holds a great deal of power. But with a trust that could conceivably last for centuries into the future, it’s certain that the trust will someday be managed by individuals or entities that don’t yet exist. What can you do to ensure your trust stays in good hands?

This is where trustee succession comes in. Speak with an estate planning attorney with experience drafting long-term trusts on procedures, provisions, and restrictions to include in the trust that determine how and when a new trustee is appointed.

You may also want to add additional layers of protection such as a trust director or trust protector.

Read more on this topic on our blog:

• Trust Protectors
• Directed Trusts
• Family Friend vs. Corporate Trustee

Watch Out 3: Vulnerabilities. Trusts Are Not Invincible.

No matter how well-written a trust is, the assets in it are still subject to some outside forces.

A trust can protect assets from private threats like creditors, divorces, lawsuits, and the bad decisions of individuals who might squander them. But a trust cannot offer protect from public-law powers. For example, a piece of real property in a trust would still be subject to:

• Tax liens, tax deed sales, or foreclosure due to unpaid property taxes
• Claims of eminent domain
• Easements
• Adverse possession
• Zoning or use laws
• Other government rights and interests

In short: A trust is not a magical shield, not even a well-written one designed to last 360 years.

Strategic Advice and Help with Long-Term Estate Planning from Gem McDowell

Trusts bring uncertainty, as you don’t know what the future will look like. But you can help avoid problems and keep your assets protected by talking through potential scenarios with an experienced estate planning attorney like Gem McDowell. Gem has over 30 years of experience helping South Carolina individuals and businesses protect their interests and plan for the future. He and his team can help you create a custom estate plan that’s robust enough to protect your assets yet flexible enough to adapt to life’s inevitable changes.

Call Gem and his team at the Gem McDowell Law Group, with offices in Myrtle Beach and Mt. Pleasant, SC, at 843-284-1021 today to schedule a free consultation.