Letters of Administration

Generally, Letters of Administration are documents issued by the Utah Probate’s Court authorizing a person (called ‘Administrator’) to manage or distribute the property of a deceased person who died intestate (without making a Will). A Utah probate lawyer will explain the function of these documents to you directly so it is clear.

Letters of Administration

Individuals can and should determine the distribution of their estate by preparing a Will which usually specifies an executor to carry out its directions. Where the decedent has left no Will, the Utah laws and procedures determine both to whom and by whom a decedent’s estate will be distributed.  It is important that the deceased’s close family members protect their interests in the decedent’s estate including being appointed as an estate Administrator. Imagine a situation where a person dies without having prepared a Will and a distant relative is appointed as Administrator and the decedent’s house and all other assets are inherited by this relative whom the decedent disliked or had no contact with for many years.  Moreover, it may turn out that a government official called the Public Administrator will be appointed by the Court to administer the estate.  The Public Administrator and his attorney are required to be paid a fee which will diminish the funds going to the decedent’s family.

The estate laws determine the family member that have the right to be appointed as an Administrator of an Estate. The Probate’s Court Procedure Act (SCPA) has many section s dealing with Intestate Administration.  Section 1001 of the SCPA provides the order of priority for the appointment of the Administrator.

When a person prepares a Last Will in which he nominates an executor, the intestacy law no longer control the selection of the estate fiduciary.  It is apparent that a person should prepare a Will so that he can select the persons who are to be in charge of handling all estate affairs.  This selection is usually a close relative or friend.  The nominated executor must present the Will to the Court for his official appointment as Executor. An attorney may be helpful in this process.

Administration proceedings can be complex and involve many issues such as proof of kinship and a search for unknown heirs. Letters of Administration will need to be obtained which requires filing a petition and many other documents with the Court.  The petition for Letters of Administration is filed in the Probate’s Court in the county where the decedent lived.  For example, if the decedent lived in Manhattan, the papers are filed in the Utah County Probate’s Court which is located at 31 Chambers Street in Utah.  Most of the Probate’s Courts in the various counties have the same requirements regarding the papers that must be filed such as the death certificate, petition, affidavit of kinship and affidavit of no-debts.   However, experienced estate attorneys are aware that some of the Courts have their own particular requirements and forms.  It is important to find out about these various estate filing specifics as soon as possible when preparing the filing papers.

Executor and Trustee

An Executor and Trustee and an Administrator are all what are generally known as fiduciaries. Fiduciaries have many duties and responsibilities. These obligations are set forth in statutes and by the courts which have developed standards of conduct to be followed by fiduciaries. A Utah estate planning lawyer can explain them in greater detail.

Executors and Trustees and Administrators are all generally accountable and responsible to the court and to the persons who are the beneficiaries for the assets which they administer.   Such responsibilities involve duties of care so that assets are protected, obligations that prohibit self-dealing and a duty to account for the assets they collect and payments they make.

Sometimes there is confusion as to the difference between an Executor and Trustee.  When a person executes a Last Will, he typically nominates an Executor and substitute or successor Executors.  The job of the Executor is to follow and carry out the terms of the Will.  Once the Will is admitted to probate, it becomes validated by the Court.  Say for example, that the Will says that the decedent’s house is to be sold and that the proceeds from the sale are to be divided into three shares, the Will further states that two of the shares are to be given to two named estate beneficiaries, However, the third share is to be given to a Trustee to be held in trust pursuant to the trust terms that are set forth in the Will.  This is called a testamentary trust.  The Will typically names the Trustee. Once the executor pays the proceeds to the Trustee, the executor’s job is finished and the Trustee takes over and administers the trust assets according to the Will provisions.  It is possible, and often occurs, that the person named as Executor also acts as the Trustee.

Executors and Trustees serve an important role in Estate Planning.  They are essential in implementing and fulfilling the intent of the creator regarding the disposition of assets.  They can also have a vital role in safeguarding the economic welfare of minor children and beneficiaries who suffer from disabilities.  It is common that a Utah Estate Plan will include a Supplemental Needs Trust to benefit someone who is receiving governmental benefits such as Medicaid or social security disability.  An attorney may be helpful in this process.

Free Consultation with a Probate Lawyer

When you need help with an estate or when a loved one has passed away, call Ascent Law for your free consultation (801) 676-5506. Our compassionate and experienced lawyers are here to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506
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Protecting Assets from Divorce

A lawyer in Utah can tell you, divorce is a leading cause of asset distribution. Here we’re talking about the most protection one can establish when engaged in a divorce property battle. We are not merely talking about hiding assets. Many people who seek divorce asset protection do so when problems arise in the marriage or after divorce papers arrive. There are tools that can provide protection under this scenario. But it is best to act beforehand.

Protecting Assets from Divorce

Under the best circumstances, transferring the ownership of your separate property, including your business and income, into an asset protection strategy prior to tying the knot more effectively guarantees the protection of your assets in divorce. Whether you do so beforehand or after the fact, having a divorce asset protection plan in place strengthens your hand in the separate vs. marital property battle.

Discussed in a Forbes article are methods used to protect your business against a future divorce. Establishing a personal asset protection strategy is one of the most important techniques they discuss. The prenuptial agreement is another. It also stresses the need to take protective measures well in advance of the need, or likelihood of the need for asset protection.

Divorce: A Top Wealth Buster

Divorce is one of the top wealth busters an individual can face. Ideally, set up an asset protection before marriage. Yes, you can set up an asset protection strategy to protect your finances from divorce when troubles arrive. However, planning measures taken years in advance offer the most protection when placed under the legal microscope.

Statistically, a divorce is more likely to happen than a major car accident and are much more costly in terms of legal fees and property separation. Imagine having a divorce insurance policy where future income, personal assets and business never make into a property battle. That’s what a divorce asset protection plan provides.

Nuptial Agreements

Prenuptial and postnuptial agreements are not watertight. Not all states recognize them. They are often challenged. So they offer very little certainty. Certainty, in this case, comes in the form of a personal asset protection strategy. By setting up the proper legal tools and transferring property into them, one can effectively shield assets from future liability and divorce.

Whereas it is best to have an asset protection plan in place before your spouse serves you with divorce papers, there are strategies that are effective at any stage in the game. Domestic asset protection strategies are usually not very effective.

Types of Business Entities

The most common form of business entities are corporations and LLCs. Business owners use these entities for multiple advantages. There are tax benefits. As stated previously, they offer protection from lawsuits against the business. Statutes usually don’t allow attorneys, medical practitioners, CPAs, etc. to form standard entities. Instead, they need to form professional corporations, professional LLCs or create a limited liability partnerships. Typically, the law requires that licensed members of a particular profession are the owners these entities.

Corporations

Corporations can offer outstanding protection for shareholders, officers and directors. Thus, these entities work well for businesses with multiple owners and employees. There are extra tax deductions, such as those for healthcare plans and medical expenses. Accountants typically recommend against using corporations to own real property. There are detrimental tax consequences compared to LLCs. Plus, creditor law considers the shares as personal assets. Creditors can seize them and sell the stock to satisfy judgments.

Limited Liability Companies (LLCs)

A Limited Liability Company also offers personal liability protection from business transactions. It shields the managers and members (i.e. owners) from liability. The LLC also has fewer business formalities than does the corporation.  By default, LLCs are pass-through tax entities. Many experts highly recommend LLCs for owning real estate. This is due to the fact that provisions prevent creditors from seizing LLC interest to satisfy a judgment. Should someone sue a company member the company and the assets inside are secure. Thus, property and other business assets held in an LLC is protected from personal liability of the managers and members.

Free Consultation with a Lawyer

When you need to protect your assets or go through a divorce, call Ascent Law for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Fraudulent Conveyance

A fraudulent conveyance is a civil (not a criminal) matter wherein assets are transferred with the intent to hinder or delay creditors. Whereas it is ideal put an asset protection plan into place before trouble arises, in reality, many people do not realize the need until it is too late. So, prepare for a lawsuit before it strikes if you can. However, if it is too late and you have not yet done so, don’t worry. There are ways to protect yourself after the fact.

Fraudulent Conveyance

Put Up a Fight

Fraudulent conveyance is also known as fraudulent transfer. Some people think that you find yourself dealing with a creditor, it’s over. They think that there is not a whole lot they can do to move assets protect them. Not true. If you can put up a fight, why not do it?

Strategies

There are a few strategies that you can employ late in the game. For example, offshore asset protection trusts take the assets outside of the local court’s jurisdiction. So even if your opponent jumps up and down and screams “fraudulent transfer,” your offshore trustee can lace his hands behind his head, lean back in his chair and look out at the palm trees wafting in the sea breeze. The reason is that your local courts do not have jurisdiction in his country.

The judge may tell you to ask the trustee to send trust funds to your legal opponent. If you make that request against your will, your trustee will support your true desires. They will invoke the duress clause and refuse to comply. You have done your part in doing what the judge has ordered. You asked the trustee to bring back the funds. The key is to make sure your trust is properly established. If it is, a judge would be hard-pressed to find you in contempt. That is because you are not refusing to comply.  You simply do not have the ability to act firsthand.

Huge Barrier for Your Opponent

This leaves your opponent a very expensive and time-consuming option: To file a lawsuit offshore. Even if he does, he will find himself in an obstacle course. One that is built intentionally to make it unlikely for him to win. A pride of lions most often eat the weakest members of the herd. So, why let yourself be easy prey? Why not be the one that puts up the biggest fight?

Fraudulent Conveyance Vs. Preparation

This is not to say that you should engage in fraudulent conveyance. It is best that you do not. It is much better for you prepare for the near inevitable. That is, set up an asset protection plan before you need it. So, this seemingly obstinate dialogue intends to give an editorial angle on the subject. It is not encouraging you to participate in this practice. It is simply saying that those who have the philosophy “I’m not going down without a fight,” put the odds in their favor over those who easily cave in.

Free Initial Consultation with an Asset Protection Lawyer

It’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Waiting Period for Divorce

If you are considering a divorce, there are many things to take into consideration, such as the potential impact separation could have on your children and your financial well-being. If you decide to turn to a divorce mediator in Salt Lake City, you may be able to resolve any disputes with your spouse in a healthier manner while conserving time, energy and money. However, there are many divorce-related requirements in Utah that you may want to familiarize yourself with, such as waiting periods.

Waiting Period for Divorce

According to the Utah Courts, divorce decrees are not signed until 90 days has passed after the date divorce petitions are filed. I’ve seen it as a divorce lawyer. That said, you and your spouse could be able to have this waiting period waived, if you are able to prove that you are going through extraordinary circumstances. Once a motion is filed, the other spouse has two weeks to object by submitting a Memorandum Opposing Motion form.

With regard to the divorce process, you and your spouse may disagree on many issues, from creating a child support order to dividing marital property and how to handle custody matters. Although divorce is often challenging, mediation may prove beneficial and help both you and your marital partner move forward. Regardless of the decisions that you and your spouse make concerning divorce, it is essential to work for a positive outcome, which is particularly important if you have children.

Please keep in mind that this information was written for general informational purposes and is not to be interpreted as a substitute for legal counsel.

FACING YOUR FEARS ABOUT DIVORCE

The decision to file and finalize divorce is never easy. Even after couples grow apart and realize that the marriage has dissolved, they may wait years or even decades to file for divorce. Some will wait until the children move out or genuinely hope that things will turn around instead of facing the inevitable. If you are facing divorce, fear is normal. Remember that you are not alone and that most divorced or divorcing couples have had similar fears.

For couples in Salt Lake City, Utah, an experienced attorney can help you review the facts of your case, identify your concerns and protect your rights. Here are some common fears about divorce:

Losing custody and a relationship with children.

Splitting up a family into two households is never easy. Both parents and children will have a difficult time adjusting, but an experienced attorney can protect your custody rights and ensure that a visitation schedule meets your needs and the best interests of your children.

Cost.

Dividing income and creating two separate households after divorce can be expensive. Alimony and child support payments can also add up. An advocate can protect your financial interests during negotiation and settlement. Financial planning and adjusting your lifestyle will also allow give you the power to manage your transition.

Failure.

Many couples will put off divorce because of the fear of “failure.” In many situations, leaving a marriage is not only a last resort, but the only healthy option. Remember that divorce isn’t failure, it is admitting your needs and the problems in your marriage so that you can move on.

Losing friends and family.

It is likely that your social network may change after divorce. On the other hand, you can maintain shared friendships. Being open, honest, and respectful will prevent your friends and family from having to choose.

Being alone.

This is one of the most common fears, but it is not a good reason to stay in a bad marriage. Many also fear growing old alone, but this is a common fear, even for those who are married. Life will change after divorce, but for many divorcees, life will change in positive ways. Empowerment in your life can mean new opportunities, new friendships, relationships, and a future of possibilities.

Free Consultation with Divorce Lawyer

If you have a question about divorce law or if you need to start or defend against a divorce case in Utah call Ascent Law at (801) 676-5506. We will help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Hidden Assets in Divorce

Hidden Assets in Divorce

A good, healthy marriage is based on trust. We all have secrets. But when those secrets affect your relationship, they can often come back to haunt you later. As a divorce lawyer, I’ve seen this happen before. Marriage is a partnership where both parties are making a commitment to share their life together.

DOES YOUR SPOUSE HAVE HIDDEN ASSETS?

And one of the biggest components is sharing your finances and assets. But when a marriage falls apart, many people resort to hiding many of the most valuable assets from their partners. Fortunately, there are ways to track down any hidden income and other assets.

DETERMINING THE DIVISION OF ASSETS

Divorce can often get complicated. One of the most complex issues is the division of assets. The first step is to consult with an experienced and knowledgeable divorce attorney
When determining the full financial inventory of each spouse, assets are separated into three different categories:

  • Marital Assets:These are assets acquired strictly during the marriage.
  • Commingled Assets:These are a mixture marital assets and separate property. The most common examples are retirement funds and bank accounts.
  • Separate Assets:These are assets that were acquired prior to the marriage or after a separation. They can also be any inheritance or gift.

ARE YOU THE “OUT SPOUSE”?

In many marriages, one spouse is often in charge of handling most of the financial decisions and bookkeeping responsibilities, whether it is filing taxes or balancing the checkbook. Divorce attorneys often refer to the spouse who does not participate in most of the financial decisions as the “out spouse”. In these instances, the out spouse generally does not have the same level of access to the couple’s financial situation. If you are the out spouse, the first step is to ask your partner to make copies of all marital financial records. A cooperative spouse can make the process much easier. Unfortunately, that is rarely the case–especially when there is tremendous acrimony in the fractured relationship. The good news is most financial records can be found online. If you are unsure of any accounts, contact any banks, mortgage companies, retirement plan advisors or any relevant financial institutions during your marriage.

A DIVORCE ATTORNEY CAN HELP WITH THE DISCOVERY PROCESS

If you have made the difficult decision to file for divorce in Utah, it is vital to know all of the assets acquired during your marriage. If you have any suspicion your spouse is hiding any assets, it is important to contact a Salt Lake City divorce attorney with a track record helping clients through the discovery process. The attorney can make requests of several important types of financial documentation from your spouse, including tax returns, loan applications, bank account records, financial statements and much more. By utilizing the discovery process, you spouse will also have to answer specific questions in writing. It is the most effective method to gain financial information from an uncooperative spouse.

WHY DIVORCE IS MORE DIFFICULT FOR MEN

Divorce can be a bitter struggle. Anytime a long-term relationship comes to an end, it can be devastating both emotionally and financially. When it comes to divorce, it is often said there are no winners. But there is definitely plenty to lose. But who stands to lose more–men or women? More often than not, the answer is men. The lazy argument is men generally make more money and have more to lose financially. But that is only part of the equation. There are some other overlooked factors many people do not take into consideration.

Here are some scary statistics. Did you know divorce can affect your health? According to a study conducted by the Journal of Men’s Health, divorced men are more likely to contract heart disease, high blood pressure and strokes than their married counterparts. They are also 39 percent more likely to commit suicide or engage in risky behavior. Although popular opinion suggests women tend to be more emotional, there is more scientific evidence that suggests it may be the opposite when it comes to divorce. Here are some reasons why.

THE LOST SENSE OF IDENTITY

Many men fall into the trap of letting marriage define who they are. When a marriage comes to an end, men often get a sense of losing their identity. For years, they have spent much of their lives with a partner to provide emotional support and sexual fulfillment. One solution is to work on rebuilding confidence by joining an organization or getting involved in a new activity. It not only allows men to branch out and meet new people, it also gives them the opportunity regaining a sense of fulfillment by accomplishing new and different goals.

PATERNAL INSTINCT IS CHALLENGED

For many men, the sense of family is the backbone of their relationship. It can be a difficult transition to go from being the head of a household to being completely out on your own. It is important for men to remain a major part in the lives of their children. Although women typically are awarded primary child custody, the bond between a father and their children can be very therapeutic.

MEN DO NOT GRIEVE PROPERLY

Divorce and death are two completely different things. However, both can cause a huge void that is seen as irreplaceable. Because men have a tendency to bottle up their emotions, it can lead to deeper feelings of depression. Psychological issues can often become powerful triggers for high blood pressure. Depression involves much more than just feeling depressed. It can also lead to physical issues, including pain and less physical activity leading to obesity and heart disease.

Free Consultation with a Divorce Lawyer

If you have a question about divorce law or if you need to start or defend against a divorce case in Utah call Ascent Law at (801) 676-5506. We will help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Insurance in Divorce

Insurance in Divorce

Just as it takes time to build a life together in marriage, the process of dissolving that marriage can take time as well. Because we are divorce attorneys, we have seen it all. Often times, separating couples in Utah may be surprised and/or overwhelmed by factors such as property division and child custody arrangements.

INSURANCE POLICIES AND PROPERTY DIVISION

It’s very important to ensure that investments like insurance policies are accounted for at the time of divorce to help ensure savings are secured and both parties are held responsible for their contributions.

Medical/Disability/Long Term Coverage

The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives individuals without their own medical insurance the option to remain on their partner’s plan during the divorce process. Typically, a person may be covered through COBRA for 36 months, which can give them the chance to obtain their own plan. And beyond deciding how to provide for each other’s health insurance needs, divorcing parents must also settle on who will cover the children’s medical expenses.

Similarly, figuring in disability insurance coverage can be helpful too. Not only do both parties need access to disability benefits in the event they become ill or injured after the divorce, but anyone anticipating spousal support should consider how it can be effected by their ex becoming disabled. Likewise, long term care coverage may be a wise investment for older individuals.

Liability Coverage

Many divorcing individuals find that their liability insurance premiums increase once they switch to single plans. Though, it’s crucial that people continue to maintain insurance on investments like the family car and house throughout divorce proceedings to ensure there is no lapse in coverage.

Life Insurance Policies

Many life insurance policies are considered long term investments, and are therefore included as assets when calculating divorce settlements. Furthermore, such policies can be used to safeguard alimony or child support payments if one spouses passes.

WHAT DOES COLLABORATIVE LAW ENTAIL?

If you are confronted by the prospect of divorce, it’s incredibly important to know the legal options and resources that are available to you and your family. Collaborative law is one approach to reaching a divorce settlement that is gaining increasing popularity here in Utah and beyond, as the process encourages dispute resolution without litigation.

As the Utah State Bar Association explains, the collaborative divorce process often begins when you and your legal counsel begin discussing your options for resolving your family law dispute. Depending on you and your family’s unique circumstances, and your relationship with your soon-to-be ex-spouse, your attorney might recommend collaborative divorce mediation. You may find collaborative divorce especially appealing if you are interested in coming to a fair and reasonable divorce settlement without engaging in more adversarial measures, such as court proceedings.

Once you and your spouse decide that collaborative divorce is right for you, you and your attorneys will agree to the terms of the collaborative process. Essentially, that means that all parties agree that both attorneys will withdraw from the case in the event that you and/or your spouse decide to exit the collaborative process in favor of litigation. Next, you and the other three parties involved in the collaborative process will engage in non-adversarial dispute resolution techniques to develop a comprehensive and reasonable divorce settlement.

Your attorney will likely work with your soon-to-be ex-spouse’s attorney to plan the negotiation sessions that you will attend, and set the tone for the meetings. Similarly, you and your husband or wife will be encouraged by both your attorneys to discuss your concerns openly, in order to reach an agreement that accounts for both of your best interests. Of course, the unique nature of every divorce case means that the collaborative process can proceed in different ways. Therefore, this information should in no way be considered legal advice.

Free Consultation with Divorce Lawyer in Utah

If you have a question about divorce law or if you need to start or defend against a divorce case in Utah call Ascent Law at (801) 676-5506. We will help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Trust vs. Will

When looking at a revocable trust versus a will, the advantage of the former becomes clear when it comes to the issue of probate. You should always speak with a licensed
estate lawyer before you make changes to your plan. A will becomes public record. It has to be registered in court of law. Then it has to be proven to be the legitimate record of a deceased person’s wishes. A probate can be a complex or simple matter. This will depend on the size of the estate, as well as the number of conflicting claimants – if any. A will cannot be executed while it is under probate. This means beneficiaries cannot enjoy the benefits of the assets until the process is complete.

trust vs will

In contrast, assets held in a trust at the time of a grantor’s death are deemed outside the probate process. As such, they pass directly to the trust beneficiaries. A probate can be an expensive and time-consuming process. With the right type of trust in place, your beneficiaries are protected from having to undergo a probate.

A revocable trust is a private document; unlike a will, which becomes a public document once it’s registered for probate. Thus, a revocable trust gives your beneficiaries a considerable measure of privacy when they likely need it the most.

What is an Irrevocable Trust?

The definition of an irrevocable trust is simple: once established, the one who created the conditions of an irrevocable trust cannot directly alter it. In can usually be changed, but the grantor or beneficiaries are not the ones who can change it directly. If it you could change it directly, without third party intervention, then a judge could order you to change the beneficiary. Then the new beneficiary of the trust would be person who just won a lawsuit against you. That is how an irrevocable trust provides asset protection. It can tie the judge’s hands from forcing you make changes that would release trust assets to your legal enemies.

To continue, the grantor also places ownership of the assets into the irrevocable trust. The trustee is in charge of the assets, as well as the management of the trust. Why would anyone transfer assets they have worked so hard for all their life into a trust? There are several reasons behind this, and three of them are given below. But first, a quick word on the unchangeable nature of an irrevocable trust’s conditions.

A grantor can maintain a modicum amount of control over the assets of an irrevocable trust through a careful wording of the trust deed. For example, a grantor can impose specific conditions that must be met before a benefit can be paid out. It could be by the time a beneficiary reaches a certain age or achieves a particular milestone. A grantor can also stipulate for income from the trust to be used solely for an explicit purpose. It could to pay for college, start a business, or for travel, and other such conditions. When the conditions are not met, no benefit will be disbursed to the named beneficiaries. A flexible wording of the trust deed allows the grantor to address unknowable future scenarios or changes in circumstances. This is one way a grantor can continue to ‘control’ an irrevocable trust without giving up its most potent features.

Why Use an Irrevocable Trust?

One of the main reasons people set up irrevocable trusts vs. revocable ones is to protect their assets from estate taxes. Once a grantor transfers assets to an irrevocable trust, he or she ceases to be the owner of the assets. Thus, these assets can no longer be taken into account when determining the value of a grantor’s estate. This makes perfect sense, since the grantor no longer owns the assets – the trust does.

An irrevocable trust can also have a strong asset protection benefit. A nuisance plaintiff, or even a grantor’s legitimate creditor, cannot touch the assets held in an irrevocable trust. Again, this is simply because these assets do not belong to the grantor anymore. By divesting themselves of asset ownership, grantors are able to protect their assets from legal claims – predatory or otherwise. It’s true that an aggressive claimant can sue a trust to distribute benefits to them rather than a debtor-grantor. But even here, a deliberate wording of the trust agreement can provide protection from such an attack.

Transferring assets to an irrevocable trust can help you qualify for certain government assistance programs with an asset limit. This would include long-term care assistance from Medicaid. Keep in mind however, that Medicaid currently has a five-year look back period. This means, assets that were transferred to a trust less than five years before a grantor applies for government assistance are not protected. In this case, you may be forced to spend them down in order to qualify for assistance. If you clear this five-year look back period, the assets in your irrevocable trust are protected. They can pass on to your beneficiaries rather being spent down in order for you to qualify for government assistance.

Asset Protection Benefits

The asset protection benefit of irrevocable trusts comes mainly from the separation of the grantor from his or her assets. Ironically, it is in giving up ownership of their assets that grantors are able to protect them the best. An irrevocable trust that has been properly established offers several benefits. Assets in an irrevocable trust are shielded from creditor claims, estate taxes and a Medicaid spend-down. A revocable trust allows a grantor to retain a fair amount of control over trust assets. This is an expedient way to avoid a probate battle. It also ensures a smooth transition to a successor trustee should a grantor suddenly become incapable of administering the trust. A revocable trust, however, does not have strong asset protection features. It remains part of the estate, and assets in such a trust can generally taken when the grantor is sued.

Free Consultation with a Trust Lawyer

If you are here, you probably have a business law issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Estate Settlement Services

When a person dies his or her estate may require the probate of a Last Will or the appointment of an Administrator or personal representative. As a probate lawyer, I’ve been known to say “where there is a will, there is probate.”  In any event, estate settlement services are required in order to collect the decedent’s assets, pay claims, bills and taxes and make proper distribution of the assets remaining in the estate.  The estate fiduciary has a duty and obligation to perform these tasks and may be held personally liable if there is a breach of fiduciary duty. A Utah estate settlement lawyer can advise you on this process.

Estate Settlement Services

In the case of the probate of a Will, the first step is to secure the original Will.  If the original Will cannot be located and only a copy is available, the probate process becomes more difficult and time consuming.  Typically, the person named in the Will as Executor completes a Probate Petition which is filed with the Utah Surrogate’s Court in the county where the decedent lived.  The probate petition contains information regarding the Will such as its date and the names of the attesting witnesses.  The petition also requires that information be provided as to the names and addresses of the decedent’s next of kin (“distributees”) and the estimated value of the personal and real property comprising the estate.

One very important aspect of Estate Settlement may involve the preparation of an Estate Tax Return.  A decedent’s estate may be subject to Federal and Utah State estate taxes.  Both the Federal and State tax systems have different exemptions and methods to calculate the amount of tax that may be due.  An Estate Tax Return requires that information be reported regarding the decedent’s Gross Estate which includes all of the assets the decedent may have had an interest in at the time of his death.

In order to properly prepare an estate tax return, the estate Executor or Administrator must search, locate and determine the value of the assets, debts, liabilities and expenses that are required to be reported on the tax return.  An estate settlement lawyer in Utah typically works with the estate fiduciary to accomplish the preparation and filing of the returns.  The Estate Attorney can prepare correspondence, contact banks and brokerage firms and other sources to assist with the search and liquidation of assets.  Additionally, an estate bank account can be established where the decedent’s funds can be deposited and from which bills and distributions can be made.

Various deductions may be used to lower the estate tax liability.  Such deductions include the Marital Deduction and Charitable Deduction.  Estate administration expenses such as attorney’s fees and executor’s commissions can also be taken as deductions as well as funeral and burial costs.

Probate Court and Wills

Probate is the process by which a last will is validated by the court.  In Utah, the Surrogate’s Court is responsible for the probate of wills and Administration proceedings where a person dies intestate or without a last will. Probate proceedings involve probate court wills. A Utah probate lawyer can help you understand this process.

Typically, probate proceedings result in the appointment of an Executor and Administration proceedings result in the appointment of an Administrator.  The Executor and Administrator are fiduciaries who are responsible for the administration and settlement of a decedent’s estate.  This involves the collection of estate assets, the payment of debts, expenses and taxes and the distribution of the estate assets.

In a typical case the following are some of the steps that occur in the probate process:

  1. 1Preliminary Investigation– after a person dies it is important to locate or search for the decedent’s Last Will.  This document may be found among the individual’s personal papers or it may be locked up in a safe deposit box.  In such a situation the Court can be asked to issue an Order allowing a decedent’s apartment to be searched or to have the safe-deposit box opened to search for the Will.  Also, steps should be taken to determine the name and location of all of the person’s named as beneficiaries in the Will as well as the decedent’s distributees.  It is the responsibility of the individual named as executor to promptly put together all of this material as best as possible so that the probate proceeding can be expedited.  Sometimes it may be difficult to determine or locate all of the descendent’s next of kin.  It may be necessary to hire a genealogist to determine the family tree or a private investigator to search for an heir whose whereabouts cannot be determined.  The process to locate a person’s missing heirs can delay estate settlement.
  2. Preparing and Filing of Probate Papers–  once the preliminary papers are gathered it is helpful to consult with a qualified probate lawyer in Utah who can assist with the completion of the necessary information and documents needed for probating the Will.  Additional information regarding the decedent’s assets and debts and business and financial affairs can be found and assessed at this time. A decedent’s business and financial matters can be hard to compile.   A good source of information aside from the ordinary records maintained by the decedent is recent tax returns and mail delivery which might contain current account statements.  Some information may need additional investigation especially if the decedent held web-based accounts.  Probate can be a very complex and often confusing process since the rules contained in the Utah estate laws must be complied with and satisfied before letters testamentary can be issued to an executor.  Letters Testamentary authorize the executor to act as the estate representative.  These letters are given after the Will is admitted to probate.

Free Consultation with a Utah Estate Lawyer

If you are here, you probably have a business law issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Asset Protection Strategies

You have worked hard all your life, perhaps as a contractor, small business owner, nurse, politician, or any other career that required your steadfast focus, and perseverance. You have created a life, and wealth through tough labor. The last thing you need is to invalidate your hard work and lose all that you have saved. That’s exactly what can happen when you’re caught in a lawsuit. I’ve seen this time and time again as an asset protection attorney, that you can do almost everything right and still lose because you didn’t protect what is yours. That is also why it is so essential to know strategies to protect assets from lawsuits. 

Strategies to Protect Assets from Lawsuits

You may have worked years to afford that boat, even decades to afford that RV, why should anyone else obtain those assets because of a human misstep. They shouldn’t.  As humans, we’re all capable of missteps, and because of this, we need to outline ways to protect assets from lawsuits; need to know what our opponents can seize. Thus, we need an asset protection strategy.

Asset Protection Strategies

Insurance: Good But Not Enough

First and foremost, regardless of what you may think about insurance, it is good to have but it is not enough.  There are severe limitations. Most civil tort lawsuits nowadays allege “fraud,” whether justified or not, because the layer can collect a greater sum. If a plaintiff makes that allegation, true or not, the insurance companies will tuck tail and run the other way. Regardless, it is still wise that you fully cover your net worth with an umbrella insurance policy.  In other words, if the policy only covers part of your net worth, it is not sufficient. You can expect to spend about $250, on average, per $1,000,000.00 of coverage. This is a steal, should you ever be in a situation where your assets are in jeopardy.

You need to also be aware of who you may inherit money from. If you’re in your father’s will, and are expecting to receive his estate, be sure to cover the full amount of which you expect. Doing so covers all that he worked hard for. Imagine a lawsuit that invalidates the estates of those you love, those of whom you were expecting an inheritance.  It’s not only upsetting, it’s personal. Protect yourself with adequate insurance, and have some peace of mind.

Owning a Business

If you own a business, it’s critical you use appropriate business entities. You need to select the right one as well. Remaining as a sole proprietor of your business offers zero protection from liability. As with the above-mentioned insurance, this acts as a guard against frivolous business lawsuits.  Having the right business entity for your small business, is in a way, insurance, and will protect you from those who work to assume your assets.

Real Estate

If you own rental property, for instance, consider owning it in an LLC (a Limited Liability Company). An additional layer we generally use is a land trust. The land trust owns the property for privacy of ownership. Then the LLC owns the land trust. Technically, the LLC is the beneficiary of the land trust. It’s important to know the multiple ways that asset-intruders get their hands on your hard work. This way, so you know how to stop them beforehand. The use of proper tools is one way of doing so.

More Strategies to Protect Assets from Lawsuits

What about divorce? What about other jointly-held accounts? It’s crucial you protect your assets from personal intrusion. This may seem “cold” at first, when considering it, but it’s not. One way to overcome the awkwardness of mentioning safeguarding yourself within a jointly-held account, is to mention the benefits for the other party.  Jointly-held accounts have the potential to wreak havoc on your assets, in the event of an unlikely divorce, or separation by one party (divorce or other relationship).  This conversation is useful to those you hold accounts with jointly, as they too will see benefits in protection.

Trusts

There are many types of trusts. To protect yourself from lawsuits, the offshore trust is one of the strongest asset protection strategies. Set it up the Cook Islands and with an offshore account in Switzerland and it is virtually bulletproof. We have never seen a client lose money in a lawsuit when we have established this structure for them.

Partnership Dangers

You also need to avoid partnerships. Like jointly-held accounts, partnerships, if used at all, the parties need to formalize it. This helps to minimize disputes between partners. The problem is that it is difficult to protect your assets in the event your partner commits an act that jeopardizes the partnership.

Consider you have a partnership with someone erecting above-ground pools. What happens when your partner is working alone, one day, but makes a serious mistake and someone ends up getting seriously injured or killed. Your assets are in jeopardy, even though you had no part in the action. You were merely his partner. The last thing you need is for your partner John’s mistake, to cost you, possibly, your life savings. So, it’s important to consider all partnerships carefully, if you used them at all. The bottom line is this: Avoid partnerships like the plague. Your partner’s mistake can cause you to lose about everything you own.

Corporations for Asset Protection

When you run a business, establish a corporation. Operating your business as a corporation gives you a legal shield should a customer sue your business. When a lawsuit strikes, the company contains the liability inside. Rather than exposing your personal home, bank account, automobiles, savings and everything you’ve worked so hard for the company acts as a lawsuit shield. It is easy to have an experienced professional (such as this one) establish a corporation for you. Simply give them the name you want to call your business, the name of the first director(s), and then cover the cost of formation. When an ugly lawsuit against your business rears its head, you will be glad you did.

LLCs for Asset Protection

Another area people need to be careful, as partially discussed earlier is the importance of forming LLCs, over a sole proprietorships or partnerships.  Sole proprietorships or partnerships essentially mean that you have no safeguard. You can be held personally liable for any misstep you take, any misstep your partner takes, or any perceived misstep. An LLC can have great tax benefits for holding income-producing real estate or other passive investments, such as stock market investments.

It is best to hold one piece of rental real estate in one LLC. That way, if someone sues the LLC, only one property is at risk. You have effectively cubby-holed your liability to one property each.

Sole Proprietorship Warning

Many people work as contractors, under the sole proprietor designation. The problem with this is that you open all your assets for the taking should you make a wrong move. Imagine you are a tutor. Your business is formed only with your first and last name. You’re not incorporated. You don’t have the LLC designation.

What happens to you as a tutor when a student looking for some form of attention accuses you of sexual harassment? You are in big trouble, is what happens. What if your employee cause bodily injury to another person? It happens all the time. Everything you have worked for is now in jeopardy, because of a simple, false accusation or employee slip up.  Don’t let someone take your earnings because you failed to form a simple LLC. The process doesn’t take very long, and in doing so, you are saving yourself from poachers.

Retirement Funds

Another way to protect your assets is to use a retirement fund. These funds are usually well protected in most states, and if you are not in need of a certain amount of money, or compounding income, being smart, is to transfer those funds into that account.  The only hiccup with this is that you need to consider, many of these accounts require you to wait a certain period to remove funds in order to remove them untaxed. You always have access to remove any funds from these accounts as you like, but there is usually a penalty for withdrawing too early, usually before around age 60, give or take. Stay up to date on the latest retirement account statues where you live.

Free Initial Consultation with an Asset Protection Lawyer

It’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you need legal help, call Ascent Law for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Optimize Your Asset Protection

You’ve worked hard to build your assets. You don’t have to work quite as hard to protect them, but a good asset protection plan requires knowledge and attention to detail. I’ve seen it because I’m an asset protection lawyer. If you do not establish and optimize your asset protection plan, a lawsuit or other unfortunate event could wipe your assets out entirely. There’s no one-size-fits-all plan. If you want to know how to protect your assets, there’s a custom-tailored optimal plan for you. So, talk with an experienced consultant.

Optimize Your Asset Protection

Business Protection

How you structure your business makes all the difference in protecting your assets. If you’re a one-person business, a sole proprietorship is the easiest way to go – but don’t do it. Sole proprietorship doesn’t distinguish between business and personal assets. Should the enterprise fail or a customer sues your business, creditors can come after your personal bank accounts, home and other assets.

LLC

A Limited Liability Company or LLC, makes far more sense for asset protection. An LLC protects you from personal liability. It can consist of members, but not shareholders. The IRS doesn’t consider an LLC a taxable entity by default, as its proceeds pass to the members. The members are responsible for paying tax on company profits. When you operate your business as an LLC, its members are self-employed and must pay self-employment tax on ordinary income. This includes Social Security and Medicare. Some exceptions are rental income and capital gains, where these two taxes do not apply. Members report all income on their personal tax returns. By appropriately filing an 8832 form the LLC can be taxed as a corporation. In addition, if a 2553 form is filed, an S corporation. Regulations vary by state, but an LLC is inexpensive to set up.

S Corporation

Another business structure for asset protection is the S Corporation. According to the IRS, an S Corp is a corporation “that elects to pass corporate income, losses, deductions, and credits through to their shareholders for federal tax purposes.” S Corps are not required to pay federal corporate income tax on profits, unlike larger “C” corporations, but may have to pay state income tax. The IRS limits S Corps to 100 shareholders, who must all have U.S. citizenship or legal resident status. Individuals qualify as shareholders, but not partnerships.

S Corp shareholders report income on personal tax returns, taxed at their individual rates. US for-profit corporations are C corporations by default. In order to turn a C corporation into an S corporation, the most common scenario is that you file a 2553 form with the IRS. You must do this within 75 days of formation or within 75 days of the beginning of the year in which you desire S corporation status. One downside – the IRS may scrutinize S Corps more than other small business structures.

With LLCs and S Corps, you must always maintain the corporate veil for asset protection. That means having annual shareholder’s and director’s meetings and writing minutes for those meetings. You keep resolutions for major corporate decisions in a written format. That also means no mingling of personal and corporate assets. All corporate assets require proper titling, and you must use corporate checking accounts and credit cards to pay business-related expenses and a personal checking account and credit card to pay personal expenses.

Protecting Your Home

Most states have a homestead exemption for lowering property taxes, but several have homestead exemptions protecting the primary home and its equity from creditors. That’s something to take into consideration if you plan to move. Utah has one of the liberal homestead exemptions, protecting up to a half-acre property within a municipality – and up to 160 acres in rural areas. However, that exemption doesn’t apply to any lenders holding a mortgage. In Texas, an “urban” homestead of up to 10 acres is protected, while an exempt rural homestead consists of 100 acres for an individual and 200 acres for a family. Texas law also exempts from seizure up to $60,000 worth of personal property for families and $30,000 for a single person. Again, the exemption doesn’t apply to mortgage lenders.

If you don’t live in a state with a generous homestead exemption from creditors, protect your home via proper titling. If you are married, your home’s title should read “tenants by entirety.” If there’s a judgment against one of you, the creditor can’t collect against the property. To optimize your asset protection plan even further, you can put your home into a land trust. This gives you privacy of ownership. We often employ equity stripping programs where we set up LLCs that you privately own and record a home equity line of credit type of mortgage against the home. Then, if need, there is an international institution that can buy the mortgage for cash. They place the cash into a “you can’t touch it” account in an offshore asset protection trust that we establish for you.

Insurance Analysis

The right type and amount of insurance protects you from losing assets to lawsuits. Inadequate insurance leaves your assets vulnerable. You may have enough insurance on your home to rebuild in case of a fire or natural disaster, but do you have enough insurance to protect you from a lawsuit if someone injures themselves on your property? For example, if your dog bites someone, expect to shell out at least $37,000, according to the Insurance Information Institute. If the dog causes permanent injury or facial scarring, expect to pay out hundreds of thousands of dollars, minimally. Umbrella insurance added to your homeowner’s policy costs just a few hundred dollars a year and provides $1 million or more of additional liability insurance for worst-case scenarios.

States require motor vehicle owners to carry a minimum amount of liability insurance, but minimums don’t go far when a serious accident involving major injuries occurs. Without adequate liability insurance, a lawsuit is virtually inevitable.  Make sure you have sufficient coverage. Be sure if you bundle your home and auto insurance with the same company, that umbrella insurance covers such catastrophes.

Although it won’t benefit you directly, make sure you have adequate life insurance to protect your family. Life insurance is especially necessary if you are the sole or primary breadwinner. Your spouse or dependents may have to start selling off assets quickly if there’s no life insurance cushion. Sit down with an insurance agent every few years to review current income, asset-to-debt ratio and future plans. A good look at the numbers will determine how much and what kind of life insurance you need.

Retirement Accounts

Your 401(k), IRAs and similar retirement accounts may make up the bulk of your assets. The good news is that most states protects these assets from creditors. However, if you fail to pay child support – or the IRS finds you owe taxes – your retirement accounts are at risk. The 2005 Bankruptcy Abuse Prevention and Consumer Protection Act extends bankruptcy protection for retirement assets to up to $ 1 million. However, that does not include inherited retirement assets, unless the heir is a spouse. Utah offers weak IRA protection that attorneys can easily penetrate with sufficient arguments showing that the debtor can attain sufficient retirement income from elsewhere.

Estate Planning and Trusts

To optimize your asset protection plan, you should also incorporate estate planning into the mix. For example, to avoid the probate process, put your assets in a revocable living trust. Although the trust now owns the assets, you as the grantor and/or trustee control them just as you did when they were in your name. You can buy, sell and add assets to the trust during your lifetime. Once you die, the trust becomes irrevocable and can’t change. Your assets go to your named beneficiaries. However, such a trust cannot provide asset protection. A trust that can provide asset protection is the Domestic Asset Protection Trust, or DAPT. Only 16 states permit such trusts.

While creditors can’t access a DAPT, it is an irrevocable trust and has an independent trustee. That means you are not the person controlling the DAPT. Based on state law, certain creditors can access DAPTs. These include former spouses demanding child support or alimony. Certain states allow a tort creditor to access a DAPT. For example, let’s say you are a doctor facing a malpractice case and create a DAPT to shield assets. A plaintiff may collect a judgment from the DAPT if you established the trust after the alleged malpractice incident, without the sufficient passage of time. On the other hand, Offshore asset protection trusts have the benefit of being outside of the reach or US courts. So, they have proven themselves much more effective at protecting assets.

Medicaid Planning

You can make have a first-rate asset optimization plan in place, and lose your assets in old age if you or your spouse requires long-term nursing home care. Failure to disclose assets to Medicaid is a criminal offense. In a worst-case scenario, you would have to spend down virtually all of your assets with the exception of your home, one motor vehicle and $2,000 in the bank, although that number is somewhat higher in certain states. Protecting assets from Medicaid is possible, but it’s a process to start well in advance. Any gifts made to children or others within 60 months – five years – of the Medicaid application are penalized. Reducing your countable assets by giving funds to loved ones must happen prior to that five-year window and with consideration of potential tax consequences.

Optimize Your Asset Protection Plan

These are just some ways to optimize your asset protection plan. Life would be easier if we knew what it will throw at us, but that’s not the way it works. There are always people lurking about knowing it is easier to take your money than to work to earn it themselves. Don’t let yourself become a victim of the legal system. Protecting your assets to the best of your ability can shield you from most of these fears.

Free Initial Consultation with an Asset Protection Lawyer

When you are ready to protect your assets, call Ascent Law for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506