Resurgens Advisory Group, LLC
Advanced Planning Strategies
For
Tax Efficient Wealth Accumulation & Asset Protection
In the United States, there are more lawsuits filed weekly than filed annually in many countries such as Japan and Canada! The permitted practice of contingency fee attorney representation, the availability of punitive damages awarded by juries, and the absence of a “loser pays” rule for expenses provide strong financial incentives to sue regardless of the merits of a claim. Insurance is becoming more expensive or unavailable in many instances, and insurance companies are scrutinizing claims more closely to minimize coverage. Many professionals, executives and their families face the prospect of personal liability for catastrophic damage awards.
Asset protection is the ability to structure the ownership of one’s assets so that they are protected from judgment creditors in the event of failed litigation. Our assumption is that one would therefore desire to seek the most cost efficient and ironclad entity possible to protect their assets.
Asset protection structures can be created domestically and/or internationally. We suggest that you consider a legal and compliant offshore asset protection trust (APT) to benefit from the more favorable laws and more reliable judicial enforcement of select foreign jurisdictions. While there will always be a place for domestic planning such as LLCs, LLPs, FLPs with various layers (even the establishment of asset protection trusts in certain states), establishing a trust in the PROPER jurisdiction provides a level of security and certainty for family and business assets not achievable under domestic law. No matter what domestic planning options one might consider, they have one major drawback– they are inherently flawed as they are subject to the “whims” of U.S. laws, juries and courts. When you combine the above with that fact that we are a litigation driven society, it is only prudent to seek the most effective and cost efficient method to protect your assets in the most effective manner possible from creditors.
Assets held by a compliant international APT can be “legally” held onshore or offshore. If desired, one can transfer the ownership of assets offshore but not the actual transfer of the assets. You can be the grantor or settlor of a trust and also its beneficiary and the trust can be established so that there is continuity of your investments by your financial advisors held within the trust.
In many jurisdictions, no trust has ever been broken! Properly designed and administered, an APT can provide barriers that are virtually insurmountable in the event of a judgment. One of the more important considerations is to work with a jurisdiction that will not honor U.S. judgments creating a situation whereby your creditor must then challenge the trust within the legal framework of that jurisdiction; this is where they find such hurdles as:
(1) "Beyond reasonable doubt" standard of proof required in establishing fraudulent intent.
(2) Statute of Limitations for challenging an APT
(3) Statutory certainty that settlor can be a beneficiary
(4) Statutory certainty that settlor can retain some degree of control
(5) Burden of proving fraudulent intent is always on creditor
(6) Posting of bond required before litigation can commence; loser pays!
(7) Statutory certainty that trust remains valid if fraudulent transfers determined to have taken place
(8) Presumption against fraudulent intent if transferor remains solvent following transfers
Also, strict confidentiality laws help ensure the privacy of your arrangements. It becomes extremely discouraging to a prospective creditor’s counsel when he finds out that your assets are properly owned in a compliant international trust in a jurisdiction that will NOT honor U.S. judgments! Or, should a creditor obtain a judgment against you and no assets can be seized, due to the reasons mentioned above, then you have the upper hand in negotiating a settlement to eliminate the creditor’s judgment.
Resurgens can assist in the proper jurisdiction selection, trust formation and on-going compliance requirements. We can also incorporate the proper language to use with the Customized PPVUL and the beneficiary’s intended objectives during life and after death. Please Contact Us for additional information.
This web site and all of its contents are for educational purposes only. All work is done subject to IRS and U.S. Treasury Department reporting requirements and filings. Treasury Department Circular 230 Disclosure: Neither Resurgens Advisory Group, LLC nor anyone associated with Resurgens Advisory Group, LLC, collectively or separately provide tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction. In order to comply with Internal Revenue Service Circular 230 (if applicable), you are notified that any discussion of U.S. federal tax issues contained or referred to herein is not intended or written to be used, and cannot be used, for the purpose of: (A) avoiding penalties that may be imposed under the Internal Revenue Code; nor (B) promoting, marketing or recommending to another party any transaction or matter addressed herein.