General Asset Protection Information
Asset protection has become a must do for middle income Americans, as well as the rich. Frivolous lawsuits are threatening business owners, and they should be taken seriously. There is a predator waiting around every corner to take away everything they have worked so hard to build. Most lawyers don’t really concentrate on asset protection, because they make their living cleaning up the mess that comes when somebody tries to take your assets away from you. Life’s disasters, such as taxes (the IRS is a disaster), divorce, ID theft, lawsuits, major medical problems, and accidents are something we all face. You will get hit by one of these disasters, and when you do you’ll have a major asset protection problem. A little asset protection planning today can mean a huge difference in your financial security when the disaster or attack occurs.
The concept of "ownership" is the core of all asset protection plans. If you don’t own it, they can’t get it when they attack you. Rather than having you "own" all of the assets, an asset protection plan will usually place ownership of assets under your spouse and/or children. The trick in asset protection planning is to move ownership away from you and still have you control the assets and get the beneficial enjoyment of the assets.
Pretty much every home on my block is occupied by a doctor or other type of professional. A quick search of the county records will show that various trusts or people unknown to me "own" the houses my neighbors live in. Each one of my neighbors has done asset protection planning, and the "ownership" of their house isn’t in their name. Often the spouse, not the professional, owns the house. If the asset protection plan is set up so the non-professional spouse owns the house, then when the professional is sued, the attacker probably can’t get the house. Make sure that you use a living trust to "own" the house rather than putting it directly in your spouse’s name, so that you don’t go through probate if he or she unexpectedly dies.
There are a limited number of asset protection tools that an attorney has available to "move" ownership of assets. You need to understand that living trusts don’t give you good asset protection. However, assets can be held by various individuals in different living trusts, thus providing some asset protection by limiting exposure to the single individual who "owns" the living trust. Corporations are good asset protection shields. Yes, a corporation is used to structure businesses, but a corporation can also be sued in a family’s asset protection plan. Limited partnerships are in important asset protection tool. If a limited partnership is used in a family’s asset protection structure, it is called a Family Limited Partnership (FLP). In today’s legal arsenal, the most flexible tool we have is the LLC or Limited Liability Company.
In any asset protection plan, a living trust needs to be used to hold "ownership" of the other entities used, such as the LLC, FLP, and corporations. Using the living trust as part of your asset protection plan, you can avoid lots of estate taxes, avoid probate, and even manage assets from your grave.
Get the book, Guaranteed Millionaire, and learn step by step how to lay the foundation of an asset protection plan. With you order of Guaranteed Millionaire, make sure they include the asset protection DVD, Using the Law to Make Money and Protect Your Assets. It’s FREE. The DVD is normally $19.99. It shows you all of the asset protection tools you have available today.
