Do You Need an Asset Protection Plan?

Fri Dec 30, 2022 | Asset Protection |

Asset protection is an often-overlooked element of careful estate planning. This is because people rarely look beyond providing for their family after they are gone – they assume that it is sufficient to set up a trust or draft a will that directs how their assets should be distributed. The problem is that this fails to consider what happens if a creditor or other claimant attempts to attach your assets. If they are successful, the value of your estate could be considerably diminished. An asset protection attorney can review your estate plan and determine what steps you should take to protect your family. 

Is Asset Protection Legal? 

When you discuss asset protection, many people mistakenly assume that you are talking about fraudulently hiding assets or, at best, making use of some questionable “loopholes” in the law. This is not the case. Asset protection involves using legal strategies to guard your estate from seizure, taxation, and other losses. These strategies do not involve any type of concealment, fraudulent transfers, tax evasion, or bankruptcy fraud. 

For example, people with considerable real estate holdings may consider owning them as tenants by the entirety with their spouse. This is a long-standing, well-recognized form of asset protection that protects the property from being seized by the decedent’s creditors. 

Planning for the Unexpected

Many people assume that they don’t need to protect their assets because they pay their taxes, pay their debts, and do not take out loans they cannot avoid. Unfortunately, unforeseen events can arise that can jeopardize your wealth. 

For example, maybe you are involved in an accident that resulted in someone’s death and you are determined to be responsible. The family of that person may now attach your personal assets in order to satisfy whatever legal claims they have against you. 

Business owners should also consider their potential exposure, even if they have been careful to keep their individual assets separate from their business assets. If your business becomes insolvent, creditors may seek to attach your personal assets in order to satisfy their claims. 

Ways to Protect Your Assets

An experienced asset protection attorney can develop an asset protection plan that is carefully tailored to your unique needs. Your asset protection plan could include the following: 

  • Ensuring you have adequate insurance protection
  • Increasing contributions to retirement plans
  • Creation of an LLC or other corporate entity
  • Creation of a trust, especially a Domestic Asset Protection Trust (DAPT)
  • Transfer of title of significant assets

Why You Need to Act Now 

The best way to protect your assets is to take the necessary steps before you face claims. Transferring assets into an asset or attempting to retitle them once the claim has arisen will likely result in your efforts being challenged. Taking these steps well in advance of any issues is the best way to demonstrate that you did not attempt to defraud your creditors or other claimants. 

Talk to an Asset Protection Attorney at Ellis Law Group Today

You have worked hard to build your wealth – invest in professional guidance to protect your family’s future. Contact us today to discuss how we can help you protect your assets by calling 561-910-7500 to schedule an appointment.