Straight Answers About Asset Protection

Asset protection is the lawful arrangement of your assets, in advance, so they are difficult or impractical for future creditors to reach. Tools range from insurance and state exemptions to LLCs and, for the strongest protection, foreign asset protection trusts.

Yes. When it is created before any claim exists, funded while you are solvent, and fully reported to the IRS, a foreign asset protection trust is a lawful planning tool that has been used by U.S. families for more than 40 years.

No. Every structure we create is fully disclosed on your tax filings, and you must disclose it truthfully in any litigation or bankruptcy. The protection comes from the law of the trust's jurisdiction and the independence of the trustee, not from secrecy.

Insurance should be your first line of defense, and we encourage adequate coverage. But policies have limits and exclusions, insurers can deny claims, and some risks (such as personal guarantees and business disputes) aren't insurable at all. A trust protects what insurance can't.

Yes, for the assets you place in the trust, and that is deliberate. Courts have refused to honor offshore trusts where the settlor kept control, so a licensed Cook Islands trustee holds legal title and manages the assets under the trust deed. You remain a beneficiary, can request distributions, and in many structures can name an investment advisor whose recommendations the trustee considers. You decide how much to place in the trust; everything else stays fully in your hands.

Yes. You remain a discretionary beneficiary, and you can ask the trustee for distributions to you and your family. The trustee decides under the trust deed, and during a period of threat may limit distributions to protect the trust.

A trusted, independent person or firm, never you, who can replace the trustee, approve major decisions, and move the trust to another jurisdiction if laws change. Keeping the protector role independent is one of the most important design decisions.

No. It is a grantor trust under IRC § 679, so income is reported on your personal return exactly as before. Anyone promising tax savings from an offshore asset protection trust should be viewed with suspicion.

Typically Form 3520 (transfers and distributions), Form 3520-A (the trust's annual return), FBAR (FinCEN Form 114) and Form 8938 for foreign accounts, and Form 8858 if the trust owns a foreign LLC. Penalties for missed filings start at $10,000, which is why we build compliance into the plan.

Transfers are generally structured as incomplete gifts, so the assets remain in your estate for estate-tax purposes and may receive a step-up in basis at death. We coordinate with your estate plan.

Transferring assets to defeat an existing or threatened claim can be undone as a voidable transfer and can lead to contempt of court, and we won't do it. But it may still be appropriate to protect against future, unrelated risks with assets clearly in excess of the existing claim. We'll give you an honest assessment.

Generally, around $1 million or more in non-exempt liquid assets, or a seven-figure net worth combined with real liability exposure. Below that, insurance, exemptions, and LLCs are often sufficient.

Usually cash and investment accounts. Retirement accounts and your homestead often already have legal protection, and real estate generally remains subject to local courts, so those are usually handled with other tools.

Yes. Your first consultation is free, confidential, and carries no obligation. We'll review your situation, tell you honestly which options fit, and provide pricing for your plan.

Typically four to eight weeks, depending on trustee due diligence and how quickly accounts are re-titled.

No. We operate a virtual office, so consultations and planning meetings happen by video and phone, and documents can be reviewed and signed without an office visit. Where your plan depends on your home state's law (such as exemptions, local real estate, or marital property rules), we coordinate with local counsel.