Protect Your Assets/ Protection from Liabilities
Never has there been a more critical need to act to protect your financial well being than now.
Do you need:
- A practical way to protect your assets from abusive lawsuits;
- A practical way to shrink the burden of income and estate taxes; and
- A practical way to safeguard your family’s financial privacy.
THE GROWING PROBLEM – FOUR MAIN HAZARDS TO FINANCIAL SAFETY
Over the last 80 years or so, it gradually has become more and more difficult for Americans to keep what they earn. Today’s rules mean that what is yours is yours – until the tax collector or someone else finds a way to take it from you. Here are the five main hazards.
1. Good-bye To Privacy Financial privacy has become a rare commodity. The enforcement of today’s tax laws is so merciless in its demand for information that honest people are left with few secrets. And even those details may show up in your morning newspaper if you ever are forced to defend against a lawsuit. Losing your privacy is disagreeable in itself – and it worsens your exposure to lawsuits.
2. Abusive Debt Collectors Unmanageable debt can be one of life’s greatest stresses. One of the most unpleasant aspects of personal debt is having to deal with aggressive debt collectors who harass debtors with abusive collection practices. . Debt collectors typically are paid on commission based on amounts they collect from you, and too often debt collectors bully and harass people in order to coerce payments regardless of their ability to pay. There are legal protections against coercive debt collectors in the form of federal and state statutes that protect debtors against unfair and bullying debt collection activity. You are not helpless in dealing with overly aggressive bill collectors especially if you have good asset protection in place.
3. Malicious Lawsuits What isn’t lost to taxes is exposed 24 hours a day to the threat of imaginative lawsuits – lawsuits from reckless government agencies and lawsuits from individuals hoping for a winning ticket in the litigation lottery. An average of 43,000 lawsuits are filed every day in the U.S. The wealth you’ve accumulated through decades of hard work can be snatched away at the bang of a judge’s gavel. And some government agencies don’t even bother with a lawsuit. They seize property on their own initiative, and dare you to sue them. The IRS, for example, can declare a “jeopardy assessment” at any time and start grabbing your assets. There is no court proceeding. You get no hearing, no right of appeal and no warning. Since 1985 federal seizures have taken over $2.5 billion from U.S. citizens. Billions more have been seized by runaway agencies of state and local governments. The grounds for a government seizure or a catastrophic lawsuit can seem ludicrous – until you become a target.
4. The Constant Drain Income from your investments isn’t yours alone. The U.S. government claims up to 39% as tax – even though you put up all the capital and you take all the risk. And when you sell, you lose 28% of your profit to capital gain tax. (You actually lose more than 28%, since inflation adds to your taxable profit but not to your real profit.)
5. The Coup de Grace – Against You Your entire estate – everything you have accumulated in a lifetime of paying income tax – is taxed again at rates up to 55%. And with the generation-skipping tax, property left to your grandchildren can be taxed at rates up to 80%. Estate tax is the ugliest tax of all. It may force a grieving family to liquidate a business or real estate holdings at fire-sale prices. It can quickly turn a $6 million estate into a $2 million estate – or less.
For many of us, the most strongly desired financial goal is peace of mind. We want the comforting knowledge that our lives will not be upset by sudden financial loss. But today, even among the very wealthy, these four hazards have reduced peace of mind to an all-time low.
Strategies to consider
It’s time to decide whether you should establish a series of Trusts, LLCs or Other Asset Protection Vehicles for yourself and your family.
Various Asset Protection Strategies:
Management Trusts: Used for the operation of an existing or new startup business.
Family Trusts: Manage your day-to-day personal affairs.
Holding Trusts: This Trust is like a vault. Holding property for complete protection.
Personal Property Trusts: Use this to stay private and limit your liabilities for everyday protection such as operating a car.
Banking Trusts: Handles all financial matters with banks and brokerage firms. Unlike with other Trusts, you have the ability to change the documents to suit your own personal wants or needs.
Limited Liability Companies: Establish a corporation, a limited liability company (LLC), or a limited liability partnership (LLP). These entities are relatively inexpensive to set up and maintain, and offer significant creditor and asset protection, if properly maintained.
Holding companies: Have multiple entities that can be arranged to be held by a single holding company. The holding company can be subject to the laws of a jurisdiction where asset protection is particularly powerful. These holding companies can also be set up fairly inexpensively.
Other asset protection strategies : Your situation may be unique, complex or it may require a custom plan or strategy that fits your circumstances and we may be able to help you find the right solution.
Why leave yourself, your family and/or your business at such a risk as to put no asset protection strategies in place? Consider the option of wealth management and its many advantages not only in regard to asset protection but also in regard to freedom of movement, privacy and wealth accumulation without excessive taxation.
If you have a concern for you and your family to protect your assets and your wealth that you have built through your lifetime, you can easily avoid wealth lost through due to lack of proper estate planning. Your best asset protection is to implement asset protection planning putting various asset protection strategies in place along with getting proper estate planning information.
And if you or your business becomes a judgment debtor as a result of a lawsuit, your judgment creditor may go after your business and personal assets to collect the judgment. The goal of an asset protection plan is to make your assets difficult for creditors to take, so that they will either go away or negotiate. It is very important to remember that your asset protection plan must be commercially reasonable. If you attempt to implement a plan that protects 100% of your assets from all creditors in every scenario you may end up with no protection, because a judge will throw the whole thing out. By utilizing various legal entities to own your business and other assets you can legally and effectively increase the degree of difficulty that a judgment creditor would have in collecting on his judgment. This gives you leverage and options you did not have before so give us a call to see how we can help protect you and your family’s assets.