How To Shield Your Wealth From Creditors and Judgments
In today’s litigious society, just about everyone needs some level of asset protection planning. Unfortunately, more and more people are using the legal system to deprive others of their life’s work.
Whether you’re involved in a car accident, a mistake on the job, a business relationship gone sour, or you simply face unexpected financial difficulties in the future, your property and hard earned assets could easily be at risk of creditors and legal judgments. Fortunately, a Grand Rapids and Muskegon asset protection lawyer can help clients implement effective strategies to keep their family’s wealth out of reach.
Proactively Avoid Lawsuits
A solid asset protection planning strategy can help you avoid lawsuits before they ever arise. It’s no secret that plaintiff’s attorneys are less likely to take a case where the chances of recovery are slim and there are no “deep pockets” to sue. The goal of asset protection planning, then, is to lower your “wealth footprint” to become a less attractive financial target, no matter how many assets you actually own.
Limit Exposure During Litigation
If a lawsuit is unavoidable, a proper asset protection plan can help ensure a more favorable outcome in the face of litigation. When your wealth is protected using legal tools such as trusts and LLCs, it will become apparent to the plaintiff and the plaintiff’s attorney that your assets are not readily available or nearly impossible to seize. At that time, your asset protection plan will give you, the defendant, the upper hand in settlement negotiations.
Legal Tools To Consider
When creating a solid asset protection plan, your Grand Rapids and Muskegon asset protection attorney will review a number of strategies with you including the use of trusts and LLCs. In some situations, a Michigan LLC may be the strategy of choice to provide the client with maximum flexibility coupled equally powerful asset protection provisions.
The state of Michigan arguably has among the best LLC asset protection laws in the nation. Michigan allows for a single member LLC to be protected by charging order, which is not typical of all other states. Michigan LLCs are private and confidential, and the laws that govern them leave little room for interpretation. Likewise, a Michigan closely-held LLC can be owned by a a Foreign or Domestic Asset Protection Trust (DAPT) to avoid having income frozen inside an LLC as a result of the charging order. This may allow a trustee to make discretionary distributions to your family and maybe even to you.
Importance of Planning Before a Crisis
The time to engage in asset protection planning is before any hint of a lawsuit or conflict arises. Any attempt to transfer assets after you are in distress can carry serious consequences, both legally and financially. The very act of moving assets in the heat of a legal battle for the purpose of delaying or hindering a creditor or legal opponent is called fraudulent conveyance, which is a crime. This may be true in the case of threatened legal action, too. The time to move your assets is before you are threatened with litigation. This can be safely done with the help of an experienced Grand Rapids and Muskegon asset protection attorney who will ensure all transfers of assets are made properly and within appropriate time frames.
If you would like to speak with a professional Grand Rapids and Muskegon asset protection lawyer, please contact Eyestone Law Offices at 800.667.5291 to schedule a free initial consultation today! We provide services throughout West Michigan and have three offices conveniently located in downtown Grandville and Muskegon and near Woodland Mall in Grand Rapids.