How Can You Protect Your Assets?
If you own anything of value, you could become a target for unscrupulous creditors and groundless lawsuits. How can you protect your assets from these threats? Asset protection starts when you schedule a consultation with a Milpitas asset protection attorney.
Someone could sue you unexpectedly and at any time if you have substantial assets. If a creditor sues you, and your insurance can’t or won’t cover the claim, what you own will be at risk. Your assets need the maximum legal protection.
By taking several estate planning steps now with the advice of a Milpitas estate planning lawyer, you can put remedies in place that will protect your assets before a creditor brings a lawsuit against you.
How Do You Begin the Asset Protection Process?
Asset protection reorganizes your finances to protect you from collection activities and lawsuits. It changes the ownership of your assets so that creditors and others cannot legally access those assets.
Several tools that limit your liability are available to establish a legal barrier between you and your assets. Before you can know what will be required, however, you must identify the assets that will need protection.
A Milpitas asset protection attorney can advise you regarding which assets and properties are already protected and what steps you’ll need to take to protect your other assets and properties.
What Are the Basic Strategies for Protecting Assets?
For most people, the most basic asset protection strategy is simply buying insurance coverage. Too many people, however, make that first step their last step, and when you need it, your insurance policy, by itself, may not offer the protection you require.
Establishing a limited liability company (LLC) or a trust can give you that protection. After reviewing your needs and financial circumstances, a Milpitas estate planning lawyer can help you determine if you need the protection provided by an LLC, a trust, or both.
What Are Limited Liability Companies?
An LLC is a business structure that shields the owners (known as “members”) from liability. An LLC protects assets by establishing a legal separation between the business and the business owner’s personal finances.
If you already own a partnership or sole proprietorship, establishing an LLC will safeguard your personal assets against liability claims and creditors. Moving your properties and assets into an LLC can be exceptionally effective for California landlords, real estate investors, and new business owners who seek protection from specious lawsuits and dubious creditors.
A Milpitas asset protection lawyer can help you establish an LLC, make property and asset transfers to the LLC, and advise you about the potential tax implications.
Do You Own Real Estate?
A limited liability company protects a property owner’s property and assets if a debt collection activity or a liability claim involves a rental or investment property.
In California, transferring the ownership of a property to a holding company is an effective way to protect the property, and a holding company is typically an LLC. The holding company will own the property and will be legally separate and distinct from you.
If your property holdings are extensive and complicated, your lawyer may recommend setting up several interconnected LLCs or transferring your assets and properties into a trust.
Should You Establish a Trust?
A trust is a financial and legal arrangement outlined in a trust document you prepare with an estate planning lawyer’s help. The “trustor” – the person setting up the trust – designates a “trustee” to oversee and manage the properties and assets transferred into the trust.
Trusts can protect your assets and properties from questionable lawsuits and creditors. Some trusts also let your beneficiaries and estate avoid the probate process after your death.
When you establish a trust, you may transfer assets and properties into the trust throughout your life. After you pass away, your trustee’s responsibilities will be similar to the responsibilities of a will’s executor.
How Does a Trust Protect Your Properties and Assets?
If protecting your assets is your primary reason for setting up a trust, you’ll want to establish an irrevocable asset protection trust. When your trust is irrevocable, the assets and properties you transfer into the trust remain there permanently.
The trust becomes the legal owner of whatever properties and assets you transfer into it. For all practical purposes, however, those properties and assets are still yours. You can still use your vacation home for your vacation, for example.
Taking your assets away from your legal ownership and placing them in an irrevocable trust protects those assets from collection activities and lawsuits. Your asset protection lawyer can help you determine which assets and properties you should transfer into your trust.
What Else is Important to Know?
It’s never too soon to reach out to an asset protection lawyer and start setting up a trust or LLC. To protect assets in California, those assets must be transferred to a trust or limited liability company before they are placed at risk by collection activity or a lawsuit.
If you transfer an asset or property to impede a collection or avoid a judgment after a lawsuit is filed, a court may consider the transfer a “fraudulent conveyance” and void the transfer, and your properties and assets will still be at risk.
If you have a family in California or own a home, a business, or anything of value, speak promptly to an asset protection attorney at Keyes Law Group about LLCs, trusts, and other options for protecting what’s yours.
Put Keyes Law Group to Work for You
From our offices in Milpitas, Keyes Law Group serves and advises individuals, families, and businesses in Milpitas, San Jose, San Francisco, and throughout Northern California.
With more than fifteen years of estate planning and asset protection experience, award-winning attorney Elijah Keyes is recognized by the State Bar of California Board of Legal Specialization as a Certified Specialist in Estate Planning, Trust and Probate Law.
To establish a trust or an LLC, learn more about estate planning, or begin planning your estate now, schedule a consultation today with the team at Keyes Law Group by calling 408-443-2397. We can’t predict the future, but we will help you prepare for it.
