Asset Protection Planning
If you own assets of any type, creditors can take them away due to debt or losing a lawsuit. Even divorce can threaten your property. Here is a quick primer on how asset protection planning can help keep everything that’s part of your estate within your control.
Persons Requiring Asset Protection Planning
Business owners at risk of being sued should definitely consider hiring an estate planner. Even those with strong business and liability insurance policies are not fully protected. Assets may still be subject to surrender if a judgment is levied against them.
Prenuptial agreements are not bulletproof, and the dissolution of a union may see an intense dispute over money. It is recommended that married couples consult with an estate planning expert.
Those entering nursing homes are excellent candidates for asset protection. An estate planner can help assure that their estates are not drained in the event of Medicaid failing to cover the entire cost of nursing.
Types of Asset Protection Planning
One primary form of asset protection involves the formation of a trust agreement. Under these contracts, you surrender some control over assets, but creditors become unable to repossess them. With someone else officially in command, you benefit by being legally separated from ownership.
The type of corporate entity you create can also impact how well you are protected. For instance, if you form a Limited Liability Corporation, your personal assets become safe from liability. When starting a company, it is vital that you choose your business formation wisely.
For married couples, assets are generally considered joint property. An estate planner can make it so particular possessions are unable to be claimed during a dissolution of marriage.
General insurance policies are not always enough. Specialized agreements are recommended under particular circumstances. These instruments provide an extra layer of security in case your policy does not cover the damage of a ruling against you.
Tax Impacts of Asset Protection Planning
Any legal maneuvers you make to protect assets are subject to taxes. Even possessions placed in trusts are subject to government tithing. An asset planner can help assure that your accountant has all the necessary information. You wouldn’t want to inadvertently cross the IRS.
You’ve worked hard for what you own and losing everything due to unforeseen circumstances is a distressing notion. Taking protective legal measures can mitigate the financial impact of life’s uncertainties. Hiring an estate planning lawyer.
to safeguard your net worth from a law office like Brandy Austin Law Firm, PLLC may be beneficial.