What are the most common asset protection strategies?

Asset protection strategies are legal methods used to protect one’s assets from potential creditors. In New York, some of the most common asset protection strategies are forming a corporation, setting up a trust, taking out insurance on valuable assets, and utilizing offshore accounts. Forming a corporation, or a limited liability company (LLC), is one of the most popular forms of asset protection. The legal entity of the corporation shields the shareholders or owners from potential lawsuits. An LLC also provides flexibility in terms of who owns the company, how it is managed, and the tax regulations that it must follow. Another asset protection strategy is setting up a trust. A trust is a legal arrangement in which one or more individuals, known as trustees, manage an asset on behalf of someone else, the beneficiary. This trust can be used to protect assets from creditors, as the assets are no longer owned by the individual but are instead held in the trust, which further shields them from potential legal action. Insurance is another common asset protection strategy in New York. By taking out a policy on valuable assets, such as property, a business owner is able to protect that asset from any damage, theft, or liability resulting from the ownership of the asset. Finally, New York residents may consider utilizing offshore accounts as a form of asset protection. By having assets in a different jurisdiction, they can be held in a different legal system, making them difficult or impossible to access in certain situations. It is important to note, however, that there are various regulations and laws in place that govern offshore accounts, and thus it is important to consult with a legal professional before pursuing this option.

Related FAQs

Can a domestic asset protection trust be used to protect assets from creditors?
How can I transfer assets into an asset protection trust?
What are the specific steps of asset protection planning?
What is a foreign asset protection trust?
What is a spendthrift trust?
What is a limited liability company (LLC)?
How can I find a qualified professional to help with asset protection planning?
How can I protect my real estate assets?
What is a family limited partnership?
What is a trust protector?

What are the most common asset protection strategies?

Related FAQs

Related Blog Posts