Asset Protection Services
Protecting Assets Before Problems Arise
Some clients have no desire to have ongoing services, some clients do. For our business clients who want proactive, continuous oversight, we offer the Business Protection (BP) Plan. This plan is designed for business owners who want to meet annually to discuss ongoing legal needs, manage upcoming corporate requirements, and conduct essential annual meetings. Like our individual plans, the BP Plan is structured around a set fee rather than hourly billing, allowing business owners to secure our attorneys’ guidance at a fraction of their standard hourly rate.
Asset protection planning is most effective when implemented proactively. Through properly structured trusts, business entities, beneficiary designations, and coordinated estate planning strategies, individuals can reduce exposure to future risks while preserving assets for future generations.
Buckley Law helps families in Colorado Springs and across the Front Range evaluate potential vulnerabilities and develop practical asset protection strategies that align with their estate planning goals. Asset protection is not a one-size-fits-all solution; every plan should be tailored to the client’s financial circumstances, line of business, family dynamics, and long-term objectives.
Check Your Insurance Coverage:
Homeowner’s Policies: For example, some families who lose their homes in fires find that their $250,000 liability policy will not go very far in replacing a home that costs $400,000 to rebuild to meet modern codes and increased building costs. Clients who suffered through the Waldo Canyon and Black Forest fires in Colorado Springs in the summers of 2012 and 2013 know this only too well.
Umbrella Insurance Policies: The cheapest property and casualty insurance you can buy is umbrella coverage. It typically covers non-business liabilities when your other insurance is exhausted. For example, if you have a judgment against you for an automobile wreck, and your auto insurance policy doesn’t cover the full amount, your umbrella policy may kick in to cover all or a portion of the remainder of the judgment. You should purchase the amount of umbrella coverage that equals your net worth.
Personal Property Policies: The value of many of your items of personal property, while priceless to you, could also be considerably expensive to replace and your current homeowner policy may not cover replacement costs. You should take into account such important things as custom college rings, inherited jewelry or expensive firearms. Again, the lessons of the Waldo Canyon and Black Forest fires is proof of this requirement.
Business Liability Policies: We all know that our society is litigious. Trial lawyers are always expanding their theories of vicarious liability, meaning you have to defend yourself against more and more creative ways of getting money from you. Make sure that your coverage for accidents is adequate to keep you from losing everything, in your business, or even personally.
Home Accident Policies: The coverage for accidents on your homestead should also be reviewed to determine if the coverage is adequate.
Life Insurance Policies: Is your coverage adequate if you have recently had children, grandchildren or adult children have returned to the nest? Many stay-at-home spouses are uninsured or underinsured. In most cases, the working spouse has not calculated the true financial cost of child care, meal preparation, cleaning and other important jobs done by stay at home spouses. The spouse bringing in most of the family’s income may not appreciate all that their spouses do, until something happens and the cost of replacing the tremendous value that spouse contributes to the family is finally evident.
Smoke Detectors: If you are going to be buying batteries for all your electronic equipment, buy some extra ones and replace all of the batteries in your smoke detectors as an annual basis. Set the date and mark it on your calendar.
Asset Protection Entity: If you have investment real estate that you rent, or even raw land, consider placing that real estate into a partnership or a multi-member limited liability company for your protection. Without entity-based planning, you have a metaphorical “six lane highway” leading right up to your front door if you are sued.
Advanced Planning
Asset protection planning is a significant part of our Firm’s law practice. Buckley Law has represented many doctors (including doctor groups), dentists and other health care professionals. Buckley Law has also represented many high-net worth individuals and entrepreneurs (including women entrepreneurs). The tools we use are legal, ethical, and customary in this type of planning. This may include forming an asset protection trust to shield your assets from creditors. We do not use tools or techniques that are not sanctioned by the Internal Revenue Service or that would be seen objectively as seeking to defraud a creditor. Legitimate asset protection planning must be done before a lawsuit happens. If a lawsuit occurs first, or you even think it is coming, it may be too late to do anything that protects you from any future judgment in that case.
We regularly employ legal tools to provide numerous lines of defense for entrepreneurs, high-net worth individuals, and professionals that face significant liability in the day-to-day practice of their profession. Those tools include irrevocable trusts (trusts formed inside or outside the US that own onshore assets) as well as limited liability companies and limited partnerships.
Most importantly, not all asset protection tools are the same. Where you form an entity is just as important as forming the entity itself, because not all state laws are the same. Some jurisdictions where you form an entity provide better protection than other jurisdictions. The primary purpose of using entities (corporations, LLCs, partnerships) for asset protection planning is to provide multiple layers of defense, insulating your personal assets from the creditor seeking to seize those assets in a judgment. A secondary purpose is to allow an opportunity for early settlement at significantly less cost in the event a lawsuit does occur.
Rationalizing the Formation of Asset Protection Trusts
Asset protection trusts (APTs) are pivotal in offering a secure mechanism for safeguarding individual wealth against potential creditors, serving as an instrumental aspect of estate planning and forming irrevocable trusts. These trusts operate by transferring assets into a trust managed by a trustee, thereby creating multiple defensive layers. Chief among their advantages are the preservation of wealth across generations, reduction of estate taxes, and the circumvention of probate processes. When an APT is properly formed, beneficiaries can enjoy substantial financial protection, being shielded from the threat of lawsuits and actions by creditors.
Differentiating Domestic and International Asset Protection Trusts
The choice between Domestic Asset Protection Trusts (DAPT) and their international counterparts presents varying benefits and considerations, offering tailored asset protection solutions. Domestic trusts generally offer more local control and simplicity, which typically translates into lower costs and fewer legal entanglements compared to offshore trusts. Nonetheless, foreign asset protection trusts can provide heightened security in jurisdictions unfamiliar with foreign judgments. Opting for one over the other should consider the needed level of protection and specific personal asset situations.
Strategic Approaches to Asset Protection
Adopting strategic asset protection measures is crucial for safeguarding personal and business assets. Noteworthy strategies include utilizing irrevocable trusts, establishing LLCs and partnerships, and ensuring adequate insurance coverage, as well as forming asset protection trusts for comprehensive risk management. Moreover, estate planning is integral to mitigating legal threats and presents organized methods to handle wealth. Developing a personalized strategy is vital for effective asset protection against potential creditor claims and litigations. An asset protection trust can serve as a financial shield in planning.
The Crucial Role of Trust Funding and Management
Proper funding and management are imperative for an asset protection trust’s effectiveness. Trustee services are required to oversee funded accounts and ensure distributions follow the trust’s setup and beneficiary needs, securing trust assets and protecting beneficiaries. This diligent management sustains the trust’s protective advantages and mitigates the risk of legal disputes or administrative errors that could compromise its integrity.
Steering Clear of Asset Protection Planning Missteps
Navigating asset protection planning requires an awareness of common pitfalls to avoid. Often, individuals fail to recognize the urgency of timely planning, making it essential to timely establish protective measures, such as an APT, before creditor claims emerge. Collaborating with seasoned attorneys aids you in adhering to asset protection laws, which maximizes the efficiency of asset protection strategies. Avoiding errors during the initial phase is key to effectively securing personal and business assets.
Asset protection can be complex, but you don’t have to navigate it alone. At Buckley Law, we bring decades of legal and financial expertise to help safeguard your assets. Our team is committed to creating strategies that protect your wealth and minimize risks.
Contact us today at 719-447-8797 or fill out our online form to schedule a consultation. Let us help you secure your future with confidence.
What is asset protection planning?
Asset protection planning provides a legal barrier between your business – for example, real estate rentals or a franchise – and your family’s personal assets (your home, your personal bank accounts and some types of investments). It typically involves the use of various legal structures – certain types of trusts, sometimes coupled with entities such as partnerships and LLCs – to decrease the exposure you and your family may face.
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