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ASSET PROTECTION
You have worked hard to
build your fortune. Now, you must protect what you have worked so hard to
form. Unfortunately, very little people! Majority of the
population that own real estate (including their residence) fail to place it in
a Living Trust to protect themselves from Probate and Estate Tax.
YOU MUST DO IT BEFORE YOU
NEED IT!
In the United States, and
most definitely in California, our attitude is that "someone must pay!"
Even if a frivolous lawsuit has been filed against you, you can be spending
thousands and thousands dollars and years of litigation defending this lawsuit.
Although insurance is
always a necessitate, many rely on insurance to protect themselves from court
judgments. Unfortunately, insurance is only a partial solution for several
reasons:
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Coverage limit is
inadequate
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punitive damages may be
excluded
-
certain types of causes
of action (i.e., intentional torts) may not be covered
-
some insurers may be
insolvent
-
Most importantly,
insurance carriers have incentives to deny coverage, even though you have
been pay your premiums.
There are several vehicles
we use to protect your personal and business assets from lawsuits.
However, you must act now
to protect your assets from unexpected risks and liabilities. If you wait
until a lawsuit is filed against you, judges are unlikely to allow the
protection of your asset and claim you have fraudulently used these vehicles to
avoid a particular creditor.
Several Strategies are used
to protect personal assets. Some may be beneficial, others may not,
depending on your situation.
| ...a fast
growing group of firms that specialize in hunting down confidential
financial data. ...The most widely used practice involves
impersonating an account holder to obtain balances, say federal
officials and state investigators.
...The growth
of the illicit industry is "explosive,"....the rise of these
unscrupulous asset searches has been fueled by the Internet, which
has made it easier...to advertise and gather information on
individuals. Those data, in turn, make it easier to
impersonate an account holder when calling a financial institution.
...These include such large ones as Bank of America Corp., Bank of
New York Co., Chase Manhattan Corp., Citibank...
[One asset
searcher] charged...$120 - $175 for a search of bank accounts.
...Among the hundreds of asset searchers, legitimate or otherwise,
the advertise on the Internet, prices range from $69 to about $300.
One such service, called the Cat, boast it will "prowl the USA" to
locate hidden assets such as bank accounts, property and airplanes
located hidden assets such as bank accounts, property and airplanes.
Another Internet advertiser, Wind Associates Inc., offers to find
mutual-fund or brokerage-account balances for $250 and to find
nonpublished phone numbers for $95 a pop. One of its mottoes:
"No locate. No charge." |
If you are
considering on using a fictitious living trust, Fictitious Name
Living Trust, you should use a third party as a trustee for it to be
somewhat affective.
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Irrevocable Trusts
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Corporations -
-
if you are in
business, you should be operating under a Corporation or a similar form
of business entity. If properly formed and operated, you may
shield you personal assets from the corporations' debts and liabilities.
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If you have
multiple business, consider operating under multiple corporations to
spread the liability. Remember, do not place all your eggs in one
basket! If you have multiple corporations, you may file
consolidated tax returns.
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Limited Partnerships
- they are treated as distinct entities from their limited partners (LP).
An LP's creditor should not be able to attach partnership assets. The
creditor will only have recourse through a Charging Order in the LP's
interest in the partnership. The Creditor can attach what is
distributed to the LP, but can't exercise management or control over the
partnership or its assets. However, a charging order that is not
satisfied within 6 months entitles the creditor to file a foreclosure
proceeding on the partnership
What is best depends on the
type of investment
Personal Residence
and 1st Vacation Home - Homes are typically not placed in Family Limited
Partnerships unless you are willing to pay rent to yourself. For a
principal and up to 1 vacation residence, you can have significant tax savings
by establishing a "House GRIT" (Grantor Retained Income Trust). This Trust
can also be used for raw land, jewelry and art (as long as your can appraise the
asset for fair lease value.
Liquid Investments
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Savings, CD's bonds and
money market accounts are perfect for Family Limited Partnerships.
This device is used to lower your estate tax by at least 60%
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Pensions - pension
assets are absolutely protected from creditors. Therefore, you should
consider placing liquid investments into a pension or profit sharing plan.
Illiquid Investments
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If you have real
estate, then you should consider placing your asset in a family limited
partnership and have a Corporation be considered the General Partner.
However, this corporation will be owned by a children's trust.
You have to protect what
you have worked your entire life
We invite you to discuss your
asset protection needs
with us. We can help protect you and your family! Call now for
a free consultation. You may reach our office at (310)205-5529.
Remember...Failing to
Plan is Planning to Fail!
LAW OFFICES OF ALON DARVISH
9454 Wilshire Boulevard, Penthouse
Beverly Hills, CA 90212
Tel: (310)205-5529
SERVING LOS ANGELES COUNTY
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