Wednesday, February 4, 2009

Protecting Your Assets



By Angelo Orlando Jr.


Protecting your assets is an integral part of estate planning and it is starting to become one of the most important aspects to estate planning. Protecting your assets so that you can pass them along to family members without suffering high tax penalties or transfer costs can be done with careful attention to your assets (Asset Protection). Creditor and liability problems can arise and you must protect yourself from these factors. Some common sources of these problems are contract creditors, tort creditors, regulatory liability, and divorce (Asset Protection). To protect against these possible problems one can use the method of giving gifts of assets to beneficiaries. Another way to protect certain assets can be a trust which protects against creditors and also from misuse of the asset by the beneficiary (Asset Protection). “In most states, a beneficiary's creditors cannot reach trust assets if the trustee's power to distribute trust assets is subject to the trustee's discretion, and the trust has been created, in good faith, by, or the fund so held in trust has proceeded from, a person other than the beneficiary” (Asset Protection). Protecting your assets is an important part of estate planning but it has some drawbacks in the legal world. If a party is involved in litigation, hiding assets can result in criminal prosecution (IEP). This increases the importance of making the right decisions when dealing with which assets to hide or
to bring to the surface.





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