Summary of Wealth Preservation Strategies:

1. It is best to get married in a non-community property state and to have a prenuptial agreement. That way, you and your spouse can structure and protect your assets and family income in the event that either spouse incurs a debt, liability or adverse judgment.

2. If you are already married, a postnuptial agreement can be created to settle your affairs in the event of adverse circumstances. Though less effective than a prenuptial agreement, a postnuptial agreement may still protect your assets and family income in some instances.

3. If you are married it is beneficial for you to have an Irrevocable Life Insurance Trust (ILIT Trust) naming you as a beneficiary in order to protect your life insurance from creditors.

4. If you live in a non-community property state and your spouse is self-employed and makes most of the household income, then file separate tax returns. That way, if your spouse is audited you are not subject to your spouse's audit.

5. If your spouse is a candidate for litigation, then you should put your assets in your own name. Do not hold them jointly. Anything you own with your spouse is likely subject to litigation and can be taken by your spouse’s creditors.

6. Create a series Limited Liability Company (LLC). Then, put all of your cash and cash equivalents into your LLC. The Member(s) should be your Irrevocable Trust(s) and the Manager(s) should be another entity. Never be the Member or Manager personally. This will help protect the LLC from personal judgments and creditors.

7. Put all your real estate into Limited Liability Limited Partnerships (LLLP). The Limited Partner(s) should be your Irrevocable Trust(s) and the General Partner(s) should be another entity. Again, you should never be the Limited Partner or General Partner personally. Most courts have a look back period of three years in which your transfer can be challenged or brought back into your estate.

8. If you own real estate in your name instead of an entity like an LLLP (and cannot transfer the real estate into an entity because there is a mortgage against the real estate), you can still do a quick claim deed and transfer your unencumbered interest to your children to protect the real estate from judgments and potential creditors. Most banks allow the transfer of real estate to immediate family members even if there is a mortgage against the real estate. Most courts have a look back period of three years in which your transfer can be challenged or brought back into your estate.

9. To save money in annual corporate renewals and bookkeeping time, you can have the same entity be the Managers for all your LLCs and the same entity can be the General Partner(s) to all your LLLPs.

10. Have a Trustee(s) manage your children(s) assets until they develop the skill and wisdom to make quality decisions on their own.

11. The advantage of a Living Trust over a Will is that your loved ones will not have to go through the probate process, saving your loved ones a tremendous amount of time and money. A Living Trust also allows you to distribute your assets according to a predetermined schedule.

The information contained on the pages of this website is not intended to provide, and should not be relied on for legal, accounting, financial or tax advice. Please consult with your tax, accounting or financial advisor or legal counsel before using any of this information.

IRS CIRCULAR 230 DISCLOSURE: To the extent that this communication (or any attachment) addresses any tax matter, it was not written to be (and may not be) relied upon to (i) avoid tax-related penalties, or (ii) promote, market or recommend to another any "tax shelter" transaction.