Asset protection is one of the goals of an effective estate plan. We use a variety of strategies and estate planning tools to legally shield your assets from taxes, legal judgments, creditor claims, seizure, and unwanted heirs. In other words, asset protection through estate planning allows you to preserve your legacy for your intended heirs. Keep reading as our California estate planning lawyers discuss trends and emerging strategies for asset protection in 2024 and beyond.
Top Trends and Strategies for Asset Protection
The types of assets we need to protect are evolving. Digital assets and intangible assets may have great value. Therefore, new trends are evolving to protect these assets. However, a comprehensive estate plan utilizes a combination of traditional and current trends for asset protection.
Examples of new trends in asset protection include:
California Private Retirement Plans
By creating a Private Retirement Trust, you can use California Private Retirement Plans (CPRP) to protect assets. Not only does the CPRP protect your assets during your lifetime, but it also protects the assets after your death.
Working with an estate lawyer is essential. To protect assets through a Private Retirement Plan, it must meet very specific requirements. For example, the Plan must have an independent trustee and independent plan administrator. An attorney ensures all requirements are met to offer the highest level of asset protection.
Protecting Digital Assets
More people are investing in digital assets, including cryptocurrencies. Protecting digital assets has become a leading concern when estate planning. First, you need to protect digital assets from hacking. Using cold storage and multi-signature wallets provides an extra layer of protection.
Next, you must address the legal aspects of protecting digital assets, such as including digital assets in your estate plan. Your will, trust, and other estate documents must include detailed instructions for managing and distributing digital assets. California Probate Code 870 addresses digital assets in probate.
Limited Liability Company (LLC)
Limited Liability Companies (LLCs) are used to protect assets by transferring the assets to an LLC. The LLC structure provides limited liability for the assets held by the company. However, it is crucial that you maintain the LLC structure, never commingle personal and business finances with the LLC, and follow all requirements of California Corporations Code §17703.04.
A current trend for protecting assets with LLCs is using a separate LLC to hold different assets. Placing property in different LLCs helps shield those assets from lawsuits related to another asset. For example, use separate LLCs for each piece of real estate you own. If you own valuable antiques and expensive vehicles, consider creating LLCs for each type of asset.
Schedule a Consultation With a California Estate Planning Lawyer for More Information
Asset protection trends change quickly because the types of assets people own are evolving. New strategies and tools are developed to address changing laws and complex financial situations. Contact Horizon Elder Law & Estate Planning to schedule a consultation with our California estate planning lawyer. We can help you develop an estate plan that offers the highest level of asset protection available.