Let’s Talk “Asset Protection”

When you visualize “asset protection” do you think about hiding money in your mattress? Maybe offshore accounts in the Cayman Islands? Or do you simply think it doesn’t apply to you?

The concept of protecting your stuff can mean different things, and it can be done for different reasons - but make no mistake, it does matter for everyone. Asset protection can be a critical part of your estate planning strategy, no matter the size of your estate. The best strategy for you will be tailored based on your goals and the nature of your assets. 

Asset protection is the process of structuring assets (property, cash, businesses, and investments) to prevent for a current or future creditor from being able to collect on those assets.

Our society has become increasingly litigious and anyone can be sued – and anything of value (or that generates income) can be at risk. What kind of liabilities do we need to protection from? 

The most common suits that expose liabilities are:

1. Plaintiffs’ lawsuits

2. Business lawsuits

3. Real Estate lawsuits

4. Creditor/Loan repayment lawsuits

5. Divorce lawsuits

6. IRS Tax actions

Assets held in checking accounts, savings accounts and CDs, non-qualified investment accounts (mutual funds or trading accounts), real property held in an individual’s name, businesses owned as sole proprietorships or general partnerships and personal property held in an individual’s name offer little or no protection and can be lost to creditors without a protection strategy.

There are various strategies for Asset Protection available in Florida, some obscure and some very common worth considering.

From the most common to the most complex some ways you can create a protected class of assets are:

1. Homestead protection and properly taking title to real estate

2. Annuities and Life Insurance 

3. Qualified accounts (IRAs, 401ks, and 403bs) and wage accounts

4. Florida-based business entities (LLCs, Corporations and Limited Partnerships)

5. Marital agreements (pre-nuptial and post-nuptial)

6. Domestic trusts (Revocable, Domestic Asset Protection Trusts, Land Trusts, other Irrevocable Trusts)

7. Offshore trusts and offshore business entities 

Asset protection is an important part of an individual estate plan and is most effective when it can be implemented before a problem arises. CLF attorneys focus their practice in Estate Planning, Business Formation and Strategy and Real Estate. Our team can help you at every stage of the asset protection process. Call us today for a …..