“Many people do not take advantage of the asset protection opportunities that can be achieved with relatively basic estate planning,” Asset Protection Planners writes, explaining that proper estate planning is meant to protect assets from both creditors and predators. “Estate planning is not just about saving taxes,” Matthew Erskine agrees, stating in a Forbes article: ” but also about managing and protecting your assets against future creditors, for both you and your beneficiaries.”
At Geyer Law, we agree, often recommending putting assets in a trust rather than giving money to a family member directly. An outright gift exposes the asset to being lost to the recipient’s carelessness, creditors, or divorce. As Indiana estate planning attorneys, we often arrange for children’s share of assets to be held in an irrevocable trust to safeguard against those very three contingencies.
An APT (Asset Protection Trust) can help deter costly litigation before it begins, or at least favorably influence the outcome of a settlement negotiation, Investopedia states, adding that an APT offers another possible benefit – income tax savings – when situated in a no-income-tax state. Importantly, our state of Indiana is one of 17 that permit Domestic Asset Protection Trusts, although we do have state income taxation on trusts.
“Divorce is a demographic fact that is often ignored in the estate planning process,” The Journal of Estate and Tax PlanSpendthrifting cautions. In addition, “Clients increasingly express concerns about spendthrift children”. Trusts can eliminate the ability of spouses to put pressure on an heir to transfer assets into joint name. “It’s simply good planning,” the authors state..And, for same-sex couples, when the relationship is not supported by one or both of the families, we explain to our Geyer Law clients, a will might be contested, a trust will offer better protection.
Trusts have protect what’s yours so it can be sure to be theirs!
– by Rebecca W. Geyer
