If you are wondering if you should be taking steps to protect your assets, you probably should. Whether you have a high-risk job or you are an average person who wants to make sure you are protected if a difficult situation arises, you should contact us to discuss your options.
Asset protection planning can take a variety forms, but all of them focus on strategies for safeguarding your most valuable assets from potential creditors. Just as important, however, is to take steps to ensure that nobody ends up in legal trouble, including going to jail for contempt or fraud for engaging in the process.
Below are a few guidelines to keep in mind when you are developing asset protection strategies:
- Start planning as soon as possible. It is imperative that you create asset protection tools before a claim or liability arises. The longer your protections have been in place, the less likely a creditor can claim they are a “fraudulent transfer.”
- Be wary of late planning. Any asset protection planning that occurs after a claim arises will likely make matters worse. In fact, a debtor and whoever assists him in fraudulent transfers can be held liable for the creditor’s attorney fees. You also lose any chance of obtaining a bankruptcy discharge.
- You still need insurance. Even if you have established an effective asset protection plan, you still need liability and professional insurance. Your insurance will help pay any legal fees, pay to settle claims, and even help you survive a fraudulent transfer claim.
- Business entities protect business assets. If you form a corporation, partnership or limited liability company, it should be used to protect business assets. Placing your personal property in a business entity does not ensure they are protected because an entity can be pierced by a creditor under a theory of “alter ego.” If successful, the creditor will have access to your personal assets. It is much smarter to create a trust to protect your personal property. However, many people misperceive that their estate planning trust protects their assets. This is not the case. Only certain types of irrevocable trusts work for asset protection.
- Don’t keep too much control. An effective asset protection plan strives to provide you with sufficient control so that the assets don’t disappear, but not so much control that other parties can argue that you and the asset protection tools are one and the same.
If you are interested in exploring your asset protection options, call us today. The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.