Wealthy individuals and families, as well as people involved in certain high-risk occupations such as small business owners, physicians, investment professionals and high-level business executives, require sophisticated strategies and tools to adequately protect their assets. Let’s look at some of the options in greater detail.
Domestic Protection
Some states are “friendlier” than others when it comes to limiting creditors’ and predators’ access to assets. Transferring assets to such a state is effective primarily because it puts them out of reach of local courts. For example, assets that are vulnerable to attack in one state may be put into irrevocable trusts and moved to states such as Delaware or Alaska. Or a limited liability company can be set up in a state like Wyoming, which is friendlier to assets held in LLCs. We believe the states with the best statutory structures are:
Alaska
Delaware
Nevada
South Dakota
Missouri
Rhode Island
Utah
Tennessee
Wyoming
Oklahoma
New Hampshire
We have helped numerous clients protect their hard-earned assets by shifting them to favorable out-of-state jurisdictions and can do the same for you.
Foreign Protection
As with domestic protection strategies, foreign protection strategies are effective because they involve the physical transfer of assets to a secure location where the assets are beyond the jurisdiction of local, state or federal courts. A simple example is to wire money offshore to protect it against creditors in the United States. While transferring assets overseas can, in many cases, provide valuable asset protection advantages, there are numerous potential problems. Many foreign jurisdictions lack the social and political infrastructure necessary to guarantee a stable investment environment. In addition, our government has mounted a campaign to stem the flow of wealth into offshore havens through legislation designed to discourage U.S. investors from sending their money to foreign countries. We have the experience, familiarity with U.S. tax law and international asset protection law to devise and implement a foreign asset protection plan for you.
Offshore Entity Formation
Forming a business entity overseas can provide a number of benefits, including tax advantages, privacy and greater protection against lawsuits for business and personal assets. Choosing the right entity and the ideal location for an offshore company is an extremely complicated matter… properly structuring the entity is, perhaps, even more so. The rewards can be great, but there are risks, particularly with regard to political and economic developments in the host nation. At Massih Law, LLC, we have an extensive network of offshore business, banking and trust connections that can enable you to maximize the benefits of offshore entity formation while minimizing the risks.
Equity Stripping
As the term implies, equity stripping involves stripping the equity from certain or all assets, including real and personal property, so that the assets will have debt attached to them. The result is that the stripped assets would have no value to a creditor or predator. For example, a simple form of equity stripping is to take out a second mortgage on a home that has already been paid off in full or one in which the owner has substantial equity. An example of a less conventional method of equity stripping would be to create liens without cash or interest payments by properly structuring certain obligations. We have experience with a number of equity stripping tools and strategies that can help you achieve the greatest possible level of asset protection.
