How can I protect my property from taxes, lawsuits and creditors in Sonoma County CA?
Asset protection is the formal process of protecting your assets from taxes, lawsuits and creditors.
Asset protection takes many forms. Insurance, such as an umbrella policy, will protect you from lawsuits where your car insurance may fall short. If you are sued for over one million dollars and are underinsured, the creditor could take your home, accounts and securities to satisfy the judgment against you. The umbrella policy would kick in and potect your assets by satisfying the judgment with insurance proceeds.
Another form of Asset protection is putting your asets in Trust. If your Assets are in a Trust then it becomes much more difficult for a creditor to reach and liquidate those assets to satisfy a judgment. If you have a trust your assets are also protected from certain forms of taxes and fees that may be extracted from your spouse or child.
A form of Asset Protection Trust is an IRA Trust. IRA Trusts can protect assets from creditors that will pray on your children. The first of which is the federal government. When you own an IRA and transfer it to your children at death, the child on average spends that IRA within 18 months of receiving it.
It would be great if you knew that these assets were protected from the 42% tax that is imposed on these securities when they are liquidated and used as income. That’s right the value of your IRA is only the value it receives upon liquidation. That means that a million dollar IRA is only worth about 580K!!!
It would be great if you knew that your IRA Assets could only be used for your childs education or their child’s education and it could not be taken by your child’s spouse in a divorce proceeding. The IRA Trust is an excellent tool that protects Assets from an array of creditors and passes wealth on to the next generation.
To find out more about Asset Protection and IRA Trusts call the Office of James A. Zakasky, Santa Rosa CA Estate Planning Attorney at 707-595-1148.
Law Office of James A. Zakasky
50 Old Courthouse Square, Suite 605 Santa Rosa, Ca 95404
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