Asset protection is the use of legal entities, structures, and strategies to make assets difficult or impossible for a potential creditor to reach. Asset protection planning often has strong estate planning benefits but does not involve a specific tool, technique, or idea. The aim of planning is to mitigate the risk to family net worth posed by creditors, predators and divorce and works best when coordinated with a comprehensive wealth creation, preservation and transfer strategy. We begin with guiding a family in understanding and assessing liability risk, then explore the available options to manage risk and insulate against claims to suit assets, control, comfort, lifestyle, and tax goals. We create the vehicles to effectuate the plan, such as family limited partnerships, limited liability companies, asset protection trusts (domestic and international), equity stripping programs, etc.
Using a holistic approach, estate planning addresses asset management in the event of incapacity and disposition of assets upon death. Well laid plans reserve flexibility, minimize all forms of taxation, obviate probate, transition assets to the right people, at the right time, and in a fashion that is efficient and insulated. We will guide a family through considering effective transition protocols, address family dynamics and special considerations, design an estate plan, and prepare the vehicles to effectuate and represent families through the probate or administration process.. Some of the tools that are used are revocable trusts, wills, health care proxies, living wills, durable powers of attorney, life insurance trusts, gifting programs, intentionally defective trusts, charitable trusts, grantor trusts, personal residence trusts, private annuities, self cancelling installment notes, etc.
Success creates unique issues, or magnifies existing issues, and there are few resources available for options and best practices. Some commonly encountered issues include, how to prepare children to operate the family assets and businesses; how to better monetize brand/image; how to effectively interact with partners/sponsors/endorsers; how to enhance privacy; how to effectively use professionals and advisors; how to launch a new venture; how to develop and execute an exit strategy for a business or asset; how to vet potential partners; how to enter a new activity; how to graciously avoid requests for loans and investments; how to incentivize employees or partners without giving away too much equity. Experience across hundreds of families and issues can provide some perspective on how others have attended to similar issues and resources and tools to understand and address them.
Tax planning involves analyzing business and asset structure to determine income, estate, capital gain, state, sales, use, inheritance, or other tax exposure and design techniques and structure options to reduce or eliminate tax exposure for current and future generations. We also assist in negotiations with taxing authorities to address current tax disputes and coordinate with litigation counsel for negotiation during adjudication.
Businesses evolve over time and often benefit from advance consideration rather than reacting to a current situation where timing can become sensitive. Business goals are reviewed and clarified to actively address risk mitigation, business exit strategies, recruitment and retention of key employees, preparation for and execution of business sales, strategic partner relationships, equity or refinancing programs. Collaboratively we determine the areas which need attention and design and create business programs. Programs include business entity structure, asset segregation and management, creation and management of business modules, buysell contracts, supplemental employee retirement programs, key employee retention programs, private offerings, etc.