When Should I Start With Asset Protection?

As with all aspects of financial planning, asset protection requires careful consideration before a plan can be put into action. It involves assessing current assets and goals, designing strategies to accomplish those goals, and preparing legal documents that support the strategy.

While it may be common to think of estate planning as the first step in asset protection, there are many other strategies that can be used, and it’s important to discuss them with an attorney before making a decision.

One of the most common asset protection strategies is to transfer property out of a person’s name and into an irrevocable trust. These trusts allow you to place assets outside of your name, and they can also help avoid probate.

However, you’ll need to carefully consider how these types of trusts work and the potential tax implications. It’s also important to talk with an attorney about whether this type of trust is right for you and your family, and if it should be part of your estate plan.

You should also think about the timing of any transfers and how they will impact your creditors if you ever file for bankruptcy. Bankruptcy proceedings are time-consuming and expensive, so the sooner you can protect your assets from being subject to your creditors’ claims, the better.

In addition to protecting your assets from creditors, an asset protection trust can help you preserve wealth for future generations while avoiding probate. These trusts are more complicated to fund than other types of trusts, so it’s important to work with an estate planning lawyer to determine if this type of trust is right for you.

Other asset protection tools include establishing LLCs and FLPs, which are separate entities from the person creating them. This helps avoid the creation of a consolidated business entity, which can be difficult to defend against claims by creditors.

It’s also important to understand that fraudulent conveyance laws are strict and can thwart many attempts to shield property from creditors. Moreover, these laws are often changed or altered on a case-by-case basis by courts and legislatures.

Some of these laws can be effective even after a lawsuit has been filed and or a judgment entered, although the most effective asset protection happens before liability is anticipated.

The most common misconception about asset protection is that it makes you “judgment-proof.” In reality, a creditor’s ability to collect a debt from an asset holder depends on a variety of factors, including the time of transfer and the method of transfer.

Asset protection planning enables you to legally and effectively insulate your assets from creditors without the risk of perjury or tax evasion. It also allows you to use a variety of creditor exemptions and other statutory and common law protections to help stop or hinder judgment collection.

While it may be tempting to shield your assets from your creditors by transferring them to friends and relatives, this is not an effective way to do it. Moreover, it can make other family members defendants in fraudulent conveyance lawsuits. This is why it’s so critical to talk with an asset protection lawyer about your options before you do any transfers.

How to Protect Your Assets

Asset protection is a strategy designed to keep your assets safe from potential lawsuits and other liabilities. It’s a must for anyone who has significant personal wealth, such as a home, retirement accounts, cash savings, or valuable possessions like cars and stock portfolios.

Assets are susceptible to a wide range of legal threats, from lawsuits filed by business partners to personal events such as divorce and bankruptcy. The more assets you have, the more of a target you become and the more you need asset protection planning.

The best way to protect your assets is to take proactive steps before the need arises. This requires a substantial investment of time and money to consult with legal, tax, and insurance experts.

Creating an entity that’s separate from you personally, such as a limited liability company or S corporation, is one of the most important steps you can take for protecting your assets. By creating a legal structure that isn’t attached to your name, you can protect your personal assets from being used to pay business debts or claims.

Another important component of asset protection is setting up a trust. A properly structured asset protection trust can help tie your hands and limit a court’s ability to reach your assets.

It is crucial to create a trust that’s irrevocable (meaning you can’t cancel it or remove control) for the most effective asset protection. Also, make sure the trustee you choose is a licensed professional.

If you live in a state that has homestead protection laws, you may be able to shield your home equity from creditor claims. This may be the most effective strategy if you are planning on filing for bankruptcy and need to protect your property from creditors.

Using other strategies, such as gifting or re-titling assets is also a good way to protect your assets from possible creditor claims. For example, married couples who live together can legally title their homes as “tenants by the entirety” and shield them from a creditor’s claim.

You can also give away certain assets to people who are less vulnerable to creditors by choosing the recipients carefully. It’s important to ensure the transfer does not violate any illegal conveyance laws.

Finally, you can avoid becoming a target of a lawsuit by not showing off your wealth. This may attract trial lawyers who could take your case and force you to pay more in court costs.

The most effective asset protection strategies include establishing legal structures, transferring assets through insurance, and exempting your wealth from creditors. While these strategies can be expensive and require extensive planning, they are worth the effort in the long run.

Brooklyn Asset Protection Attorney

A Brooklyn Asset Protection Attorney can help you protect your wealth from creditors and litigants and pass it on to your heirs without the need for court proceedings. A seasoned lawyer will work with you to develop a personalized plan that fits your specific situation.

Asset Protection Planning for Professionals

As a New York asset protection lawyer, I advise clients to protect their assets from lawsuits and creditors through the use of a variety of strategies. Many of these include a carefully crafted estate plan, establishing trusts, and well-planned gifting. I also help clients maximize their exemptions and minimize estate taxes, which is vital for anyone with substantial assets or a large estate.

Long-Term Care Medicaid Strategy and Fraudulent Transfers

The best way to protect assets when applying for Medicaid benefits is through an effective estate plan. By working with an experienced Medicaid attorney, you can create a plan that ensures the assets you need to qualify for the program are protected, while also keeping the income available to pay for nursing home care.

If you are thinking of applying for Medicaid or are concerned about the effects of a loved one’s application, it is important to speak with a skilled and experienced asset protection attorney in New York. 

Family law and divorce issues can jeopardize your assets, too. In this situation, a prenuptial or postnuptial agreement can be used to preserve your financial interests. Our office often works together with matrimonial and divorce lawyers to help our clients make prudent decisions that will prevent their assets from being used against them in a future divorce or separation.

Creating a sound asset protection plan is one of the most important decisions you can make, as it will prevent your hard-earned money from being wasted due to the loss of assets. If you are looking for a Brooklyn asset protection lawyer to discuss how we can protect your hard-earned wealth, contact us today at our Brooklyn law office.

New York Legacy Lawyers by Yana Feldman & Associates PLLC

New York Legacy Lawyers by Yana Feldman & Associates PLLC

132 32nd St, Brooklyn, NY 11232, United States

(718) 713-8080