Asset Protection

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Asset Protection Attorney in Reston, VA

We Can Help You Explore Your Options for Asset Protection

A major component of estate planning involves using the latest and most effective asset protection techniques. Asset protection refers to using legal means of protecting your assets from creditors and predators, including the tax collectors!

While many people think asset protection involves shady or dishonest techniques, there are many ways to protect financial reserves, personal property, real estate, and other assets for retirement or for future generations. In addition to federal and state laws that exempt certain types of property from creditors’ claims, taxation or both, there are numerous estate planning tools that may be able to shield assets from future creditors and reduce or eliminate estate or income taxation.

For example, in some cases, you can contribute your assets to an irrevocable, self-settled asset protection trust and achieve asset protection. Virginia, Delaware, Nevada, Alaska, and several other states offer statutes that allow grantors to establish these asset protection trusts. In other cases, you may want to use limited liability entities such as corporations or limited liability companies to shield your personal assets from creditors of your business and to protect investment assets from your personal creditors. In extreme cases, you may want to use offshore trusts or other offshore entities for asset protection.

Whatever vehicle you select, you need to be aware of the constraints on all asset protection techniques. First, you cannot set up an asset protection vehicle to avoid claims of existing creditors without taking the risk that the entity may be unwound by a court as a “fraud” on your creditors. Second, you must NOT use an asset protection vehicle to evade taxes. While structuring your affairs to avoid taxes may be legitimate and permissible, tax evasion is the illegal practice of not paying taxes, by not reporting income, reporting expenses not legally allowed, or by not paying taxes owed.

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