November
1, 2005
By
John Dietz, Senior
Advisor of Trustmakers
Samuel
Clemens once said:
“Put all you eggs in
one basket, and watch
that basket.” Of course,
the famous writer was
full of wonderful idioms.
He seems to always
be able to look at
life with a pair of
glasses different from
our own. I can only
imagine what Mark Twain
would have thought
about the world of
Asset Protection. Interesting
it is that the prolific
writer went from business
deal to business deal
never fulfilling his
quest for the good
life.
Asset
Protection takes a
different approach.
It resides in the separation
of assets; it uses
more than one basket.
What is needed for
a well thought out
plan is separating
liability generating
assets. Assets that
are for trade generally
would be in an LLC,
S corp. or C corp.
The decision is usually
what suits best tax
wise. Partnerships
can be very flexible
for business purposes,
but the main Asset
Protection reason to
use the FLP is that
it separates ownership
from control. This
triggers the first
rule of Asset Protection:
What you don’t own
can’t be taken from
you. The General Partner
is a one or two percent
owner, and the Limited
Partner gets the rest.
The General Partner
controls the assets,
but doesn’t own anything;
while the Limited Partner
just about owns everything,
but has no control.
The
offshore prong being
the Asset Protection
Trust should never
engage in any liability
generating anything.
It will have its own
offshore assets that
can be invested any
where in the world.
It should always be
a top financial institution
that is safe and secure.
This now becomes a
fully functional Kinetic
Asset Protection Plan.
By invoking the second
rule of Asset Protection,
you have now triggered
the second rule of
Asset Protection: No
country in the world
automatically recognizes
U.S. judgments.
Don’t
get hung up on the
offshore part. This
is safe and secure,
and no Trust Company
will steal your money.
The technology won’t
allow it.
Asset
Protection does use
more than one basket,
but I think Twain would
have liked the idea.
I think he would have
said, “You need to
watch all of your baskets.”
Until
next time,
John
If
you would like more
information regarding
asset protection, trusts,
family limited partnerships
or the subject of this
article please call
or email our office.
|
