Dynasty Trusts
An effective strategy to protect assets for other family members is by utilizing a Dynasty Trust. A Dynasty Trust is an irrevocable trust which is designed to hold many different types of assets for the benefit of third parties.
An individual can transfer significant wealth to a Dynasty Trust which will give the beneficiaries of the Dynasty Trust a level of asset protection insofar as the assets held in trust for their benefit will not be subject to the reach of potential creditors because the beneficiaries will not have direct ownership of the trust assets.
Additionally, if properly structured, a Dynasty Trust will avoid transfer taxes (generation skipping transfer tax and estate tax) at each generation, as the assets will not be included in the estate of the beneficiary upon the beneficiary’s death. Therefore, any appreciation in assets generated by trust property until the beneficiary’s death will be exempt from estate tax, as long as those assets remain in trust for future generations. Under Florida law, these trusts can last as long as 360 years.
Asset Protection videos
- How can a limited liability company provide me with asset protection?
- How can I protect my interest in real property?
- I carry malpractice and/or liability insurance. Is that enough to protect my assets?
- Is asset protection only for the wealthy?
- Is it possible that I may need more than one LLC?
- Should I use a trust to protect my assets?
- What are the tax implications of a business registered as a subchapter S corporation versus an LLC?
- What is a domestic asset protection trust?
- What is tenants by the entirety?
- When should I start asset protection planning?
- Would a living trust provide protection for my assets if I were sued?
- Does a small business (subchapter S) corporation give me the same protection as an LLC?
- Can you describe how an asset protection trust works?
- Can I prevent a daughter in law or son in law from benefitting from my child’s inheritance if they get a divorce?
