Asset Protection Law Journal

Asset Protection Law Journal

Helping individuals and businesses take advantage of asset protection laws

Category Archives: Domestic Asset Protection Trusts

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Keep Bankruptcy Code §548(e) in Mind if You Have a DAPT

Posted in Domestic Asset Protection Trusts, Fraudulent Conveyances, Ohio Legacy Trusts
About 16 states now have laws that allow a Domestic Asset Protection Trust (DAPT). These trusts can be very useful to protect assets in many situations. But keep in mind that a DAPT (like other asset protection strategies) is designed to protect your assets and keep you out of bankruptcy. It may be less useful… Continue Reading

Two or More APTs May Be Advisable In Some Situations

Posted in Asset Protection Strategies/Alternatives, Domestic Asset Protection Trusts, Ohio Legacy Trusts
In Ohio (as in other states that have enacted a Domestic Asset Protection Trust Statute), it may be advisable to have two or more trusts as part of an overall asset protection plan. For example, a husband and wife may each want to have their own, separate Ohio Legacy Trust.  Not only can this help… Continue Reading

Mississippi is Latest State to Enact DAPT Statute

Posted in Domestic Asset Protection Trusts
The Mississippi “Qualified Disposition in Trust Act” takes effect today.  Mississippi has now become one of about fifteen states that have a domestic asset protection trust statute. Each of these state statutes is different.  But they all offer (with certain exceptions) an opportunity for creditor protection – – as long as appropriate formalities are followed. … Continue Reading

Asset Protection Trust Should Have Provision Allowing Trustee to Change Situs

Posted in Asset Protection Strategies/Alternatives, Domestic Asset Protection Trusts, Ohio Legacy Trusts
Earlier this year Ohio joined a number of other states that allow creation of a domestic asset protection trust.  In Ohio, it is called an Ohio Legacy Trust. Ohio law (just like the law of every other state) can change at any time.  We currently anticipate no significant change in the new Ohio domestic asset… Continue Reading

Affidavit of Solvency is a Reminder to Plan Before You Have Creditor Problems

Posted in Domestic Asset Protection Trusts, Ohio law, Ohio Legacy Trusts
Ohio Revised Code §5816.06 requires an affidavit of solvency each time you transfer assets to an Ohio Legacy Trust.  This is a fairly standard provision for transfers to Domestic Asset Protection Trusts in other states as well.  In Ohio, failure to timely file such an affidavit may be used as a basis for an action… Continue Reading

Trusts Require Flexibility

Posted in Asset Protection Strategies/Alternatives, Domestic Asset Protection Trusts, Irrevocable Life Insurance Trusts, Offshore Trusts, Ohio Legacy Trusts
Asset protection planning (and estate planning) frequently involves the use of one or more trusts. Possibilities include an offshore trust, Domestic Asset Protection Trust, irrevocable life insurance trust and various other kinds of trusts.  Most of these trusts are designed to last for many years. It is therefore important to give the trustee the flexibility to adjust… Continue Reading

Who Needs an Ohio Legacy Trust?

Posted in Asset Protection Strategies/Alternatives, Domestic Asset Protection Trusts, Ohio law, Ohio Legacy Trusts
Here are some of the people who should at least consider setting up an Ohio Legacy Trust: Business owners CEOs and Directors Physicians Accountants Attorneys People considering marriage Others who are willing to part with total control of a portion of their assets The following chart (prepared by my partner, Paul Fidler) provides some general… Continue Reading

New Laws In Ohio Offer Much Better Asset Protection Alternatives

Posted in Domestic Asset Protection Trusts, Limited Liability Company, Ohio law
The Ohio Legacy Trust Act (part of Ohio House Bill 479) becomes effective on March 27, 2013.  Ohio will become one of approximately 15 states with what is commonly called a Domestic Asset Protection Trust Statute. Ohio House Bill 479 also increases the Ohio homestead exemption and makes other changes that offer better asset protection… Continue Reading

Alimony and Child Support Excluded from Protection of Ohio Legacy Trust Act

Posted in Divorce and Prenuptial Agreements, Domestic Asset Protection Trusts
The Ohio Legacy Trust Act, which will become effective in March of 2013, cannot be used to avoid child support or alimony payments.  The new statute (part of Ohio House Bill 479) provides creditor protection under certain circumstances for assets contributed to a legacy trust (also commonly known as a domestic asset protection trust).  But… Continue Reading

Ohio House Bill 479 Improves Asset Protection in Ohio

Posted in Domestic Asset Protection Trusts, Ohio law, Personal Residence
Ohio House Bill 479 – – commonly known as the Ohio Asset Management Modernization Act (OAMMA)  will affect a variety of asset protection strategies in Ohio.  The new law was signed by Ohio’s Governor on December 20, 2012 and will become effective in March of 2013.  House Bill 479 authorizes legacy trusts in Ohio.  Ohio… Continue Reading

What Are The Best Asset Protection Jurisdictions?

Posted in Asset Protection Strategies/Alternatives, Domestic Asset Protection Trusts, Offshore Trusts
There are many factors to consider in deciding whether a particular jurisdiction is or is not favorable from an asset protection standpoint.  Certain states and foreign countries are clearly better than others.  There is a constant tension between the legal rights of creditors and debtors; and each jurisdiction is to some extent more or less… Continue Reading

Bankruptcy Trustee has 10 Years to Challenge Transfer to a DAPT

Posted in Domestic Asset Protection Trusts, Fraudulent Conveyances
A number of states have enacted Domestic Asset Protection Trust (DAPT) legislation.  Ohio may soon join those states.  These statutes authorize what are known as "self settled" trusts.  This essentially means that the person setting up the trust is also one of its beneficiaries.  Thus, the person setting up the trust is attempting to protect… Continue Reading

Proposed Legislation Would Make Ohio a Leading Asset Protection Jurisdiction

Posted in Domestic Asset Protection Trusts, Ohio law
Ohio House Bill 479 — commonly known as the Ohio Asset Management Modernization Act (OAMMA) –would make Ohio a leading asset protection jurisdiction.  The proposed legislation would: Permit a so-called Domestic Asset Protection Trust (DAPT). Provide an essentially unlimited homestead exemption, similar to those in Florida, Texas and several other states. Specifically protect inherited IRAs.… Continue Reading

Update on Domestic Asset Protection Trusts

Posted in Domestic Asset Protection Trusts
A domestic asset protection trust (DAPT) is one of many different entities that may (or may not) be an appropriate part of an asset protection plan. At least eleven states have enacted DAPT legislation. States that have DAPT statutes include Alaska, Delaware, Nevada, South Dakota, Hawaii, Missouri, New Hampshire, Rhode Island, Tennessee, Utah and Wyoming. While there are similarities, each… Continue Reading

Mortensen Case Highlights Fraudulent Conveyance Issues

Posted in Divorce and Prenuptial Agreements, Domestic Asset Protection Trusts, Fraudulent Conveyances
A recent decision by the United States Bankruptcy Court for the District of Alaska (In Re: Thomas Mortensen, Case No. A09-00565-DMD) is clearly worth reading — for a discussion of fraudulent conveyances, Alaska asset protection trusts, applicable statutes of limitations, and a variety of other asset protection topics.  I will likely comment on this recent case in… Continue Reading

Domestic Asset Protection Trust Versus Offshore Asset Protection Trust

Posted in Domestic Asset Protection Trusts, Offshore Trusts
Alaska was the first state in the United States to pass a domestic asset protection trust statute.  Prior to 1997, this type of protection could only be obtained in offshore jurisdictions such as the Isle of Man.  A number of other states — including Delaware — have subsequently enacted similar statutes.  There is now an ongoing… Continue Reading

Surrendering Some Control of Your Assets Required for Asset Protection Trust

Posted in Domestic Asset Protection Trusts, Irrevocable Life Insurance Trusts, Offshore Trusts
Any trust that can help protect your assets from creditors requires that you surrender at least some control over those assets. This goes for an offshore trust; a so-called "domestic asset protection trust"; an irrevocable life insurance trust; and any other trust that gives you creditor protection. If you think about it, this is just common sense. If… Continue Reading

Traditional Asset Protection Is Frequently the Best

Posted in Asset Protection Strategies/Alternatives, Domestic Asset Protection Trusts
There are many asset protection strategies, and the more expensive and complex ones are not always the best.  I like the comment made by Jay Adkisson (a nationally recognized asset protection planner) in the May 11, 2009 issue of Forbes Magazine.  He basically says the best ways are the old ways. While that is a big generalization, there is… Continue Reading
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