As it turns out, money can make people happy. Having a large gross domestic product (GDP) or inheriting a fortune can offer you many benefits that other people don’t have access to. This is especially so in the legal realm. The law offers many procedures that can benefit you in protecting your wealth and possessions from creditors and excessive taxation. A domestic asset protection trust is just one of the many trusts that are available to people who want to protect their assets.
Though these procedures are usually litigated by the wealthy, you can receive the same protection with the help of an experienced asset protection lawyer. This legal procedure should be considered by anyone who’s going to transfer property into another person or upon their deaths as claimed in their will. If you wish to know more about the benefits of asset protection trusts and the legal practitioners who specialize in these legal procedures, continue reading because this article will touch upon the details.
The primary benefit of this trust is to protect the assets or the amount of money that’s being transferred to a beneficiary upon the death of the testator. A testator is a person who owns assets and property and who writes a will or testament where he claims who will receive what upon their deaths. A beneficiary is a person who’ll be inheriting assets or property once the testator has died. By placing your assets and property in a trust, you’re protecting or adding an extra layer of protection onto these things.
The detail that provides the most security in a domestic asset protection trust is that it’s an irrevocable trust or to be further clarified with this type of trust, it’s one that’s formed within the United States, for domestic assets and property. When you’ve secured your assets and property with an irrevocable trust, you no longer have control over those assets and property; the financial responsibility or control of the assets is now with the trustee.
The will is placed in the care of a trustee or a person who looks after the trust until the testator has died, whereupon the will is opened and the respective assets are transferred to the beneficiaries. Once you’ve made and signed off on an irrevocable trust, it cannot be undone. It’s very hard and expensive to undo an irrevocable trust which is why most asset protection lawyers advise that you are sure about the beneficiary you choose.
Now, that we got the basics out of the way, the following list will highlight and explain many of the benefits that you’ll receive when you proceed with this legal procedure.
The Protection Of Assets and Property
As briefly explained above, domestic asset protection removes the financial responsibility from your name and leaves it set within your will, where it’ll await a beneficiary. Under this legal procedure, your funds will be safe from anyone looking to profit or seek compensation from those funds; since those assets aren’t under your name any longer, creditors and litigators do not have rights on those assets.
Most asset protection lawyers recommend this method to their clients instead of revocable trusts or other similar procedures. A revocable trust is the polar opposite of an irrevocable trust. Any procedures with an irrevocable trust can’t be undone by the testator and those assets can’t be touched, whereas a revocable trust grants the testator the same rights a trustee would have, thus they still have control and responsibility for the assets and can change beneficiaries whenever they please. Meaning, they’re still subjected to pay if a suit or fee should arise.
Institutional Trustees
Though domestic asset protection trusts fall under the irrevocable trust banner, they have a different function than other trusts. Above was mentioned about trustees; most trustees are people who you’re close to and trust with aspects concerning your life. With this procedure, your trustee can be a close advisor or an institution of your choice, but this institution cannot interfere with any dealings within your trust.
Taxation Benefits
While we’re still talking about avoiding excessive fees and payments, let’s talk about the tax benefits you can receive by putting your assets and property in an irrevocable trust. Since you’ve transferred your assets and property to a trustee, those assets cannot be taxed since you no longer have control over those assets. This particularly benefits people who own big estates because the taxes on these pieces of property tend to be higher than others.
Probate
One aspect that should be greatly emphasized is that property or asset owners need to write a will or testament in order to avoid probate. If no will has been written upon your death, the courts will decide you will inherit what; this is called a probate. It’s something that many people try to avoid because the courts can grant certain assets or pieces of property to people you don’t want to assume possession of.
Now, this can be avoided by simply writing up a domestic asset protection trust and leaving it in the care of a trustee. By doing this, the people you choose to inherit will assume possession of the assets or property you’ve entrusted them.
In Conclusion
You have a lot of advantages with money. Not only do wealthy people tend to live longer, according to studies, but there are many legal procedures that you can take which can protect the assets and property you’ve worked hard to earn over the course of your life. Once your elderly age has come around, it’s important that you write a will detailing named beneficiaries and the property they will inherit upon your death.
Wealthy people use domestic asset protection trusts to secure their wealth and their properties. This trust was made for domestic assets and property within the United States, not for foreign assets. This plan can save you a lot of money from debtors looking to profit from your assets; these assets will also be secure in the hands of a trustee who, upon your death, will distribute them to the beneficiaries you’ve named. By going through with this legal procedure, you’ll not only find that your property and assets are safe but you’ll have peace of mind.
