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Asset Protection Asset Protection

Protecting Your Assets

LLCs, Corporations, and Trusts

In the early days of asset protection, everyone was touting the protections of putting everything you owed into a business entity such as an LLC or Corporation. Because of the deliberate abuse of using companies as asset protection vehicles, there are now many laws on the books that make them ineffective as a way to shield your assets from creditors.

You will find a lot of conflicting information on the Internet about this, so it is best to consult with a licensed professional in your state. My take is that it is probably more trouble than it is worth and certainly screams fraudulent conveyance if done within the state-defined timeframe.

Trusts, on the other hand, can and do provide excellent asset protection. However, they are very expensive to set up and maintain and, unless you have significant assets to protect, this is going to be a waste of your time and money. If you think a trust might be a good way to protect your assets, make sure you consult with a licensed professional and shop around.

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