Asset Protection

Don't Like Paying Taxes? Geithner Says Too Bad.

It has been a busy year for us here at Platt Law, and we haven't been as regular with our e-newsletter as we have in the past. For that, I apologize.

There has been a great deal of uncertainty and debate in the wealth management and planning world regarding the future of the tax laws and how they will affect the average American as we try to build wealth for our families and provide for them in the future.

A question I get almost daily from my clients centers on the future of the wealth transfer taxes in this country. If you recall, the current tax laws will lower the estate and gift tax exemption to $1 million per person on January 1, 2013 (less than six months from today). What this means to you is that if your estate (which includes the death benefit value of any life insurance policies you own) is over $1 million, your family could pay up to 55% of each dollar over that amount to the IRS.

A Mother’s Love

If a theme is to be found from my many interviews with clients over the years, it’s that parents love their children and will do anything for them.  Over and over, when I work through the estate planning process with my clients, I find that the guiding principle motivating parents in their planning is the happiness and well being of their children.  Parents will frequently state to me that they are willing to do anything for the success and happiness of their children. 


This sentiment was proven again in a dramatic fashion recently.  You’ve likely heard by now about the amazing story of the mother in Louisville, KY who protected her children from almost certain death when a tornado with 175 mph winds ripped their brand new brick home to shreds.  If you’ve not seen the inspiring newsreport yet, it’s well worth watching.

Over the River and Through the Woods . . .

It is becoming more common these days for families to own vacation homes. Often, these second homes become the center of a lifetime of fond memories for generations. In many cases, the sentimental feelings attached to these vacation homes are more pronounced than the feelings attached to the family’s actual residence. It’s not hard to see why.

In our regular homes, kids do homework, complete chores, get disciplined by parents, etc. But at a vacation home, parents tend to relax, kids make fun memories with aunts, uncles, cousins, and siblings. There are often fun activities and lots of good food that go along with the time spent there.

Over the holidays I had the opportunity to spend a few days with my family at just such a vacation home. It was hard to come back to reality after that weekend, but I so enjoyed watching my kids have the time of their lives with their cousins playing in the snow, wrestling, playing hide and seek, beating their uncles in checkers and more.

Long Term Care Benefits Available to Surviving Spouses of Wartime Veterans

There are over 9 million surviving spouses of veterans currently living in the United States. Many of these surviving spouses are receiving long term care or will need some type of long term care in the near future, and there are funds available from the Veterans Administration (“VA”) to help pay for that care. Unfortunately, many of those who are eligible have no idea that any benefits exist for them or that an attorney can help them become eligible.

Benefits Available. There are three types of pension benefits available that provide monthly cash payments to surviving spouses who either have low income, long term health care needs, or both. The pension benefit is referred to as “Death Pension.” Below is an overview of the three benefits, and more detail will be provided on each benefit in the following paragraphs.

Can You “Hide” Your Assets Legally?

I’ve had a number of clients ask me if it is possible for them to “hide” their money legally. The answer is, of course, not a simple one. It really depends upon who you’re trying to hide it from and how you define the word “hide” in this context.

Can you conceal how much wealth you have from those whom you casually associate with on a regular basis? Sure. Why not? Don’t dress expensively, drive a Maserati, vacation in the French Rivera, or live in a palace on the mountain benches and you’ll probably be able to fly underneath the radar of most people.

Winehouse Had Her Legal House In Order

I’ve briefly discussed the case of the late Amy Winehouse before. She was young, very talented, and had found financial success and notoriety as an R&B singer. Here’s a great video of one of her performances in case you’re not familiar with her.

In the past, I’ve pointed out times when celebrities have really dropped the ball when it came to estate planning. And more often than not, when an estate plan fails big, it’s not that an estate plan was never done, it’s that an estate plan WAS done, but it was out of date or did not reflect the current wishes of the deceased individual.

But I Thought I Owned That!

You know something I see fairly regularly in my practice is confusion about how people think they own assets versus how the assets are actually owned, i.e., whose name is on the title--whether that be manifested as a property deed, stock certificate, bank statement, etc. This confusion usually occurs when someone owns property (or thinks they own property) with someone else.

For example, husband and wife purchase a home together, and they think that they both own it. But if you look at the deed for the home, it only has husband's name on it. Or three business partners purchase a vehicle for company business, but instead of the company's name on the title, it has the partner's name on it who will be driving the vehicle.

What difference does it make? In normal day-to-day activities, it probably makes little noticeable difference. However, when certain events occur (such as death, disability, divorce, lawsuit, dissolution of business, sale or gifting of an asset) whose name was on the title can make a big difference in terms of time and money.

It's Not If. It's When.

A couple of weeks ago I was invited to sit on a panel of Elder Law attorneys up at the Utah Law and Justice Center in Salt Lake to speak to the public about the legal issues that most commonly face aging individuals. One of the audience members asked the question, "How much does it cost to work with an attorney to get this kind of planning in place?"

One of my colleagues responded to the question by explaining that it can vary widely depending upon your specific circumstances (amount of wealth, types of assets, family dynamics, and how it is you would like to see your estate inherited by the beneficiaries). But the portion of his response that struck me the most was this:

Give Your Kids a Gift They Can't Give Themselves, Part II

Last week, I explained how using a spendthrift trust can protect the inheritance you leave to your children from divorces, lawsuits, and creditors that your children may encounter in the future.

However, even in those states that do recognize the validity of a spendthrift trust, there is nothing that you can do to prevent a creditor from attaching (getting their hands on) those assets once they've been distributed to the beneficiary (your child). In order to protect such distributions from the reach of creditors, the creation of a discretionary trust is very effective.

Give Your Kids a Gift They Can't Give Themselves, Part I

What would you say if I told you that you could give your children a gift that they can never give themselves and that this gift could possibly save your family hundreds of thousands, or even millions, of dollars? Sound too good to be true? It's perfectly legal (see the Utah Uniform Trust Code) and fairly simple with an asset protection trust.

Asset Protection Is Not Just for the Wealthy

Because asset protection is commonly associated with offshore planning, such as forming an asset protection trust in the Cook Islands, you might be thinking, "Asset protection? That's only for the ultra rich or for people involved in tax evasion!" But spendthrift trusts (a form of asset protection trusts) are readily recognized by many states and courts (including Utah) as a valid means of protecting assets for third-party beneficiaries (i.e., your children).

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