A recent release by a well-known Nevada asset protection lawyer ranks states by their domestic asset protection trust laws. Ohio was ranked in the top 5 nationwide, at number 4 (behind only Nevada – in which the ranking lawyer lives and practices law, South Dakota, and Tennessee). This ranking provides a good reminder that some… Continue Reading
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Settlor Can Retain a Lot of Control Over an Ohio Legacy Trust
Posted in Domestic Asset Protection Trusts, Ohio Legacy TrustsAs I previously noted in a post back in 2013, you can establish an Ohio Legacy Trust without giving up complete control of your assets. Your Trust must be irrevocable and you cannot serve as your own Trustee. But you can still maintain significant control over the assets in the Trust if you want to… Continue Reading
Living in One State and Setting Up a Trust in Another
Posted in Asset Protection Strategies/Alternatives, Domestic Asset Protection Trusts, Ohio lawCan you set up a trust in a state that you do not reside in? The answer is yes. You can set up a trust in a country you do not live in. As a resident of Ohio, I can establish a trust in Delaware or Alaska or the Cook Islands or almost anywhere else. … Continue Reading
Trust Protectors
Posted in Asset Protection Strategies/Alternatives, Domestic Asset Protection TrustsFor hundreds of years, trusts have had three key players. The settlor is the person who establishes the trust. The trustee is the person responsible for the operation of the trust. And the beneficiary is the person (or persons) who the trust is intended to benefit. Recently, a fourth role — that of the trust… Continue Reading
Keep Bankruptcy Code §548(e) in Mind if You Have a DAPT
Posted in Domestic Asset Protection Trusts, Fraudulent Conveyances, Ohio Legacy TrustsAbout 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 TrustsIn 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
Ohio Legacy Trust Not Likely To Affect Your Income Taxes
Posted in Domestic Asset Protection Trusts, Ohio Legacy TrustsClients frequently ask about potential income tax aspects of an Ohio Legacy Trust. An Ohio Legacy Trust will likely have no effect at all on your income tax situation. The trust will be structured so that it is a grantor trust pursuant to §677 of the Internal Revenue Code. It meets the requirements of this… Continue Reading
Mississippi is Latest State to Enact DAPT Statute
Posted in Domestic Asset Protection TrustsThe 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 TrustsEarlier 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 TrustsOhio 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 TrustsAsset 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 TrustsHere 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 lawThe 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 TrustsThe 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 Enacts Domestic Asset Protection Trust Statute
Posted in Domestic Asset Protection Trusts, Ohio lawOhio now has a Domestic Asset Protection Trust statute. A new section 5816 of the Ohio Revised Code (the Ohio Legacy Trust Act) creates what is commonly known as a Domestic Asset Protection Trust. The new statute was signed into law by Governor Kasich on December 20, 2012 and will become effective in March of… Continue Reading
Ohio House Bill 479 Improves Asset Protection in Ohio
Posted in Domestic Asset Protection Trusts, Ohio law, Personal ResidenceOhio 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 TrustsThere 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 ConveyancesA 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
Ohio Could Soon Have a Domestic Asset Protection Trust Statute
Posted in Domestic Asset Protection Trusts, Ohio lawLast month, the Ohio House of Representatives passed House Bill 479, which I have discussed in posts on May 1, 2012 and May 23, 2012. If the Ohio Senate goes along with the House, there will be a new Section 5816 of the Ohio Revised Code that provides for the Ohio Legacy Trust Act. This… Continue Reading
Proposed Legislation Would Make Ohio a Leading Asset Protection Jurisdiction
Posted in Domestic Asset Protection Trusts, Ohio lawOhio 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 TrustsA 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 ConveyancesA 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 TrustsAlaska 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 TrustsAny 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
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