Asset Protection Consulting Continued…

Accountants, Financial Consultants, and Some Real Estate Brokers will provide consulting. Many of these individuals understand the various means of protecting assets that are available. However, the fact is that asset protection is fraught with legal pitfalls and a lawyer specialized in Asset Protection Consulting should be your first choice for help.

A Brief Explanation

The goal of asset protection is to make it difficult for creditors to go after your property while at the same time allowing you to retain substantial control. Your Asset Protection Consultant will want to make it as difficult as possible for anyone to claim your property. Asset protection can involve vehicles such as insurance, trusts, partnerships, corporations and offshore entities that hold your assets. A risk analysis should be performed to determine the extent of your exposure and what steps you will need to take to protect yourself.

Care must be taken whenever you Asset Protection Consultant seeks to transfer property in an effort to stop an existing creditor from rightfully claiming payment on debt. Such moves are often considered a violation of the Uniform Fraudulent Transfer Act and can result in penalties as severe as incarceration.

Careful, There are Scams Out There

As mentioned earlier, there are a vast number of individuals acting as Asset Protection Consultants who are unqualified to help you. In addition to avoid them you also need to avoid a few scams. Be wary of any Asset Protection Consultant who proposes one of the following schemes:

• Putting your money with a foreign trustee -- In fact any suggestion that places control of your assets in the substantial control of another entity or individual is a bad idea.

• Foreign Bank Account -- the consultant will tell you these are protected from both creditors and taxes. They are protected if the creditor doesn't find it. As for taxes, US Citizens must pay taxes on income regardless of where that income is generated.

• Pure Trusts and Constitutional Trusts -- promoters claim these incur no taxes. The IRS, CIA and FBI have a special task force that tracks down and eliminates these trusts.

• Nevada Corporation or international business company (IBC). Proposed as a way to protect assets from creditors and save taxes. These rely on secrecy to deter creditors. Taxes are only saved at the State level and only if you maintain a business in Nevada. Any savings in State taxes may actually raise your Federal tax burden.

By MS Kauffman