Does Texas Allow Asset Protection Trusts?
No. Texas has not passed a domestic asset protection trust (DAPT) statute, and current Texas law does not let a trust shield your own assets from your own creditors just because you named yourself the beneficiary. A domestic asset protection trust is a self-settled trust — one where the person who funds it and the person it protects are the same person — and a handful of states, Wyoming among them, have passed legislation creating a specific statutory exception that makes that structure work. Texas hasn't. The answer isn't a matter of drafting the trust more carefully; a Texas statute closes the door directly, regardless of how the document is worded.
This page covers the specific statute that answers the question, why the general spendthrift protection Texas trusts do offer stops working the moment the settlor and the beneficiary are the same person, and what to do instead — the Texas-specific tools that protect assets without a DAPT, and where to look if a true self-settled trust is actually the goal.
The Statute That Answers the Question — Property Code §112.035(d)
Texas trust law does let a settlor protect a beneficiary's interest from that beneficiary's own creditors. Under Property Code Section 112.035(a), a settlor can write a spendthrift provision into a trust, restraining a beneficiary's ability to voluntarily or involuntarily transfer their interest in the trust's income or principal before the trustee actually distributes it. Section 112.035(b) says a document simply declaring the trust a "spendthrift trust" is enough to trigger that restraint, and Texas courts enforce it — an heir's creditor, a divorce, or a lawsuit against the beneficiary generally can't reach the interest until the trustee pays it out.
Section 112.035(d) is where that protection stops. If the settlor is also a beneficiary of the trust, a provision restraining transfer of the settlor's own beneficial interest does not prevent the settlor's own creditors from reaching that interest in the trust estate. The statute carves out two narrow exceptions to what counts as being a "beneficiary" for this purpose — a trustee reimbursing the settlor for taxes owed on the trust's income doesn't count, and neither does an interest created through someone else's power of appointment — but outside those two situations, being both the settlor and the beneficiary is exactly what strips the protection away. In plain terms: a spendthrift provision protects what you leave to someone else. It does not protect what you keep for yourself by routing it through a trust you also benefit from, no matter how the trust document is worded.
Why Texas Doesn't Have a DAPT Statute
That result isn't a drafting gap — it's Texas's default rule for trusts, and nothing else in the Property Code carves out an exception to it. Chapter 112 is Texas's general trust-creation chapter, covering how a trust is formed (Section 112.001), spendthrift provisions (Section 112.035), and revocation by the settlor (Section 112.051), among dozens of other trust-administration provisions — and no subchapter in it creates a parallel structure that shields a settlor's own assets from the settlor's own creditors. A number of other states have gone the other direction and passed a separate statute doing exactly that, creating a self-settled trust that, set up correctly under that state's law, protects the person who funded it. Wyoming is one of them. A Texas resident who specifically wants that structure typically has to set it up under another state's law — see our Wyoming Asset Protection Trust page for how that structure works in a state that actually allows it.
What Texas Offers Instead
Texas asset protection planning runs through different tools, and most of them work regardless of whether a self-settled trust was ever the goal. The closest functional substitute is the charging order protection built into a Texas LLC. Under Business Organizations Code Section 101.112, a judgment creditor of an LLC member can't seize the member's ownership interest, force its sale, or vote it — the creditor's only remedy is a court order redirecting any future distribution to the creditor instead, and Section 101.112(g) extends that same exclusive remedy to single-member LLCs. Because the judgment in that scenario usually runs against the owner personally, not the company, a properly maintained LLC protects the owner's own ownership interest from the owner's own creditors in much the situation a DAPT gets marketed for. Our Asset Protection Strategies page walks through the charging order mechanics in full, and our LLC Asset Protection page covers what else an LLC's liability shield does and doesn't cover.
Two more protections apply automatically, with no entity or trust required. The homestead exemption under Property Code Section 41.001 protects a Texas owner's home from an ordinary creditor's judgment, and Section 41.002 sets no dollar-value cap on the exemption at all — only acreage limits. Our Texas Homestead Protection page covers those limits in full. Property Code Section 42.001 separately exempts a defined list of personal property from seizure — up to $100,000 aggregate fair market value for a family, $50,000 for a single adult — regardless of how the property is held or titled. Our Texas Exempt Assets page covers what's on that list.
A trust still has a real role here — just not as a self-settled structure. The same Section 112.035 spendthrift protection that can't shield your own assets from your own creditors works exactly as intended for a beneficiary who isn't the settlor: property left to a spouse, a child, or another heir can be protected from that person's creditors, a divorce, or their own inexperience with money, for as long as the trustee holds it. An irrevocable trust that permanently moves assets out of your name — as opposed to one you also benefit from — can still take property out of your own creditors' reach, for the same reason it's no longer available for you to spend. Our How a Trust Protects Your Assets page goes through both mechanisms in full.
If a Self-Settled Trust Is Specifically the Goal
None of the tools above are a self-settled asset protection trust, and for some readers that specific structure — not a substitute for it — is the actual goal. Texas law doesn't offer a path to build one here, but a small number of other states do, and Wyoming is among the most established. Our Wyoming Asset Protection Trust page covers what that structure requires and what it protects. Which route actually fits depends on what you're protecting, from whom, and how much control over the assets you're willing to give up to do it — worth a direct conversation before committing to either path.
Conclusion
Texas does not allow a self-settled asset protection trust, and Property Code Section 112.035(d) is the specific provision that closes the door — a settlor's own creditors can reach the settlor's interest in a trust regardless of any spendthrift language, no matter how carefully the document is drafted. That leaves Texas asset protection planning to the tools that actually work here: a properly maintained LLC's charging order protection, the homestead and personal-property exemptions, and a trust drafted for someone other than yourself. For the one structure Texas law doesn't provide, the option is to look at a state that does — not to try to draft around a statute that doesn't bend.