Short answer: In a Utah divorce, putting marital property into a trust does not automatically take it out of the marital estate. In Dahl v. Dahl, the Utah Supreme Court held that a trust labeled "irrevocable" was actually revocable because the husband kept an unrestricted power to amend it, that the wife became a settlor of the trust by contributing marital property, and that Utah law "does not allow spouses to place marital assets in revocable trusts and then shield those assets from equitable property division in the event of a divorce." Truly irrevocable trusts are harder to reach, and trusts created by parents or other third parties generally hold the beneficiary spouse's separate property. The answer depends on who created the trust, whose money funded it, what powers the spouses kept, and why it was created.
Why Trusts Come Up in High-Asset Divorces
Wealthy families use trusts for estate planning, tax planning, creditor protection, and business succession. Many couples fund a joint revocable living trust with the house and investment accounts. Business owners sometimes move shares or options into irrevocable trusts for estate tax reasons. Parents leave inheritances in trust for a child. When the marriage ends, each of these structures raises a different question about what the court can divide.
Revocable Trusts: The Dahl Rule
Dahl v. Dahl, 2015 UT 79, 459 P.3d 276, is Utah's leading case on trusts in divorce. During the marriage, the husband created the "Dahl Family Irrevocable Trust" under Nevada law and funded it with property that included the marital home, which the wife conveyed by deed. The wife did not sign the trust agreement and said she never saw its terms. Id. ¶¶ 27, 34, 37.
The Supreme Court reached four conclusions that matter to any Utah spouse with a trust:
Utah law applied despite the trust's Nevada choice-of-law clause, because Utah has a strong public policy interest in the equitable division of marital assets. Id. ¶ 16.
The label did not control. The trust called itself irrevocable, but the husband reserved the power to alter or amend any of its terms, and an unrestricted power to amend includes the power to revoke. The trust was therefore revocable under Utah law. Id. ¶¶ 16, 30–32; see Utah Code § 75B-2-602 (formerly § 75-7-605).
The wife was a settlor. Under Utah law, a settlor includes anyone who "contributes property to" a trust. Utah Code § 75B-1-101(33) (formerly § 75-7-103). Because she contributed marital property, she could revoke the trust as to the portion attributable to her contribution. Utah Code § 75B-2-602(2)(b) (formerly § 75-7-605(2)(b)); Dahl, 2015 UT 79, ¶¶ 35–38.
Title is not decisive. In determining whether trust property is marital, "how the property is titled is of no consequence." Id. ¶ 38 n.12.
The court remanded for the district court to determine which trust assets were marital and either allow the wife to withdraw her share or credit her with an equitable offset. Id. ¶ 38 n.11.
The Trust Has to Be a Party
A divorce court cannot divide property owned by a trust that is not before it. In Dahl, the divorce court initially declined to consider the trust assets because the wife had sued the trust in a separate action and had not joined it in the divorce. The Supreme Court held that because the trust held marital property, it should have been joined as a party to the divorce action. Dahl, 2015 UT 79, ¶¶ 9, 11. If a trust holds assets you believe are marital, the trust and its trustee need to be brought into the divorce case early.
Irrevocable Trusts Are Harder to Reach
Dahl involved a trust that turned out to be revocable. The Supreme Court expressly took no position on whether a spouse could place marital property in a genuinely irrevocable trust and frustrate equitable distribution, and it flagged the issue for the Legislature. Id. ¶ 39 n.13.
Hillam v. Hillam, 2024 UT App 102, 554 P.3d 1137, shows how difficult those cases can be. In 2012, the husband created an irrevocable trust and the same day transferred to it 1,000 stock options from his employer, valued at about $350,000. Id. ¶¶ 8–9. The district court found that the options were marital property but held they were not subject to equitable distribution because they were now held by an irrevocable trust, a separate entity. Id. ¶¶ 18, 36. The Court of Appeals did not reach the merits of several of the wife's challenges because she had not raised those theories in the district court. Id. ¶¶ 28–40. It rejected her argument that transfers made in contemplation of divorce should be divisible because the district court found the trust was created for estate tax savings, a finding she did not challenge. Id. ¶¶ 41–45.
The wife did win on one point. The Court of Appeals held that the trial court applied the wrong framework in deciding whether the transfer was dissipation of marital assets. The question is how much the transfer depleted the marital estate, not whether the options still existed inside the trust. Id. ¶¶ 51–53. A spouse who cannot reach the trust itself may still recover the value through a dissipation finding and an offset against other assets. See Hidden Assets and Forensic Accounting in Utah Divorce and Stock Options and RSUs in Utah Divorce.
The lesson from Hillam is procedural as much as substantive. Theories based on creditor rights, public policy, and the timing and purpose of the transfer have to be raised, briefed, and supported with evidence in the district court.
Utah Asset Protection Trusts
Utah allows self-settled asset protection trusts, in which the person who creates an irrevocable trust can also be a beneficiary and still receive protection from creditors if the statute's requirements are met. Utah Code §§ 75B-1-301 to -303 (formerly § 25-6-502). Those protections have specific limits for family claims. The statute defines a "domestic support obligation" to include child support, spousal support, and "an unsatisfied claim arising from a property division in a divorce proceeding." Utah Code § 75B-1-301(3). Property transferred to the trust while the settlor was in default on a domestic support obligation does not receive the trust's protections against the holder of that obligation, and the trust instrument must require the trustee to give holders of those obligations 30 days' written notice before making a distribution to the settlor. Utah Code § 75B-1-303(2)(a)(iv), (5)(a)(i), (8)(b).
Trusts Created by Parents or Third Parties
A trust created by a spouse's parents, with that spouse as beneficiary, usually stands on different footing. Gifts and inheritances to one spouse are generally that spouse's separate property. The risk arises when distributions come out of the trust and are mixed with marital funds or used to buy joint assets. Once that happens, the separate character can be lost. See Commingling in Utah Divorce. A beneficiary interest can also matter for alimony, because regular trust distributions may be treated as income.
The 2026 Dahl Decision
The Dahl litigation returned to the Court of Appeals in Dahl v. Dahl, 2026 UT App 131, decided August 27, 2026. On remand, the district court characterized the trust assets, valued the marital portion as of the 2010 divorce decree, and awarded the wife a net total of $1,843,836.88. Id. ¶¶ 3, 34. The Court of Appeals reached four holdings that matter for trust cases:
Valuing the trust's investment account as of the decree date was within the court's discretion, given the general rule that assets are valued at the time of the decree and the court's findings that later commingling and missing records made a present-day value too speculative. Id. ¶¶ 40–43.
Waiting cost the wife the appreciation. A settlor who revokes a trust is entitled to appreciation during the trust's existence, but the wife took no action after the 2015 remand to revoke her portion and withdraw her share, so the decree date effectively became her revocation date. Id. ¶ 42. Simple interest, rather than compound interest, was also within the court's discretion. Id. ¶ 44.
The husband's credit for $356,201 in premarital assets held in the same account was vacated because the findings did not address whether those assets had become so intertwined with marital funds that they could no longer be traced. Id. ¶¶ 45–48.
The district court had to rule on the wife's dissipation claim. She showed unexplained transfers out of the trust account, and once apparent dissipation is shown, the burden shifts to the other spouse to show the funds were used for a legitimate marital purpose. Id. ¶¶ 49–52.
Westlaw carries this notice on the 2026 opinion: "NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL."
What to Do If a Trust Is Involved
Get the complete trust agreement and every amendment, schedule of assets, and funding document.
Identify the settlor or settlors, including any spouse who contributed property without being named.
Read the amendment, revocation, and distribution provisions. A trust labeled irrevocable may not be.
Trace what went into the trust, when, and from which accounts.
Join the trust and trustee as parties if trust assets may be marital.
If you have a right to revoke and withdraw your share, act on it promptly. Delay can cost you the appreciation.
Develop the evidence on why the trust was created and when, and preserve every legal theory in the district court.
If you are considering a trust during the marriage, involve both spouses and document whether assets are intended to remain marital or separate. See Premarital Businesses in Utah Divorce.
Frequently Asked Questions
Is property in a revocable living trust divided in a Utah divorce?
Yes, if it is marital property. The Utah Supreme Court held in Dahl v. Dahl that spouses cannot place marital assets in revocable trusts and then shield those assets from equitable division.
Does calling a trust irrevocable protect it in a divorce?
Not necessarily. In Dahl v. Dahl, 2015 UT 79, a trust labeled irrevocable was held revocable because the settlor kept an unrestricted power to amend it. Genuinely irrevocable trusts are harder to reach, but a transfer into one can still support a dissipation claim.
Is a trust my parents set up for me marital property?
Generally no. Gifts and inheritances to one spouse are usually separate property, but distributions that are mixed with marital funds or used to buy joint assets can lose that protection.
Does the trust need to be part of the divorce case?
Yes, if you want the court to divide assets the trust holds. In Dahl v. Dahl, 2015 UT 79, the Utah Supreme Court held that a trust holding marital property should have been joined as a party to the divorce.
If Your Divorce Involves a Trust
Trust cases turn on the documents, the funding history, and arguments that have to be preserved from the start. Contact Jeremy Miller at Pearson Butler to discuss how Utah law applies to the trusts in your marriage. See also High Net Worth Divorce in Utah and Property and Debt Division in Utah Divorce.