estate planning for well to do or wannabe well to dos!

[Rich Weese]

I was asked deep in a buried thread to answer a couple questions about my reply in a recent post. here is the start.
I post a lot about parallel programs. There is a reason I do that. It is the best of both worlds and I can. Have 2 completely separate entities, and I mean separate, with no possible cross contamination. Yes, it can be done. In the one side, you enter all your free and clear property. 1 or 100 doesn't matter.
In the other entity , you buy ALL the stuff you can afford-use owner financing from seller. there are even some on BP! These are your hedge against inflation. Make sure they are all together and all flow together.
You now have 2 entities that you "control" and neither touches the other OR you. You are not the owner, just the manager.
If market goes up with runaway inflation or stupid government, I win. I have tons of property increasing 10-20% per year(yes it did) and on a 10% down payment acquitision, when it goes up 20%, I make a 200% return on my down. It adds up fast. 10's of thousands quickly turns into hundreds of thousands or more. Your mortgaged batch provides write off from depreciation to help cover some of the net from free and clear properties. Then, if you feel the need, take profits by selling on owner financing at the new monstrous values.
Now, in the bad market that may catch you by surprise.. Just walk away from the mortgaged poperties. No contingent liability and you still have your untouched free and clear cash cow. If you put it together correctly, you'll have beat the game, imo. You need some funds, knowledge, real estate license, (or in the business) Irevocable Trust with you as manager but NOT the bennie., couple other entities, several insurances, PERFECT attorney , accountant and reserves. That is most of it.
I hit the high points on this and left out a lot, I'm sure. This has worked marvelously for many years. Make sure your attorney includes "a poison pill". That is the cou da graw(misp).
If you get this far, you'll be ready for econ 601! It consists of adding a couple other layers on top of what you already have.

Disclaimer- I'm not an attorney, accountant, realtor, college grad, tall, handsome, or "rich". Consult what you need to do it right. I have lots of horror stories I could share from stupid........(any of the above listed. They'll cost you lots of money. Remember,

"No one will ever pay your fine or serve your time" Rich

[Vikram C.]

Bryan, a trust is a weird concept derived from English common law. It is not fully an entity like a corporation but it is best to think of it that way. A trust operates through a trustee or trustees. It is created by a settlor or trustor and managed by the trustee for the benefit of the beneficiary.

The rules that govern a trust are determined by the document creating the trust and that is where its beauty lies. Your lawyer can create a trust to suit your specific requirements and, unlike a coporattion or other legal entity, your trust need not be like anybody else's trust. You can either create a trust while you are alive (inter vivos) or you can create a trust through your will. Obviously, for the purpose of asset-protection, you would want an inter vivos trust.

A trust can be revocable or irrevocable. The problem with a revocable trust is that it does not afford you very good asset protection because you are able to revoke it and a court can direct you to revoke it and pay your creditors. That is why Rich has an irrevocable trust - one that cannot be revoked or modified after it is created.

Even with irrevocable trusts, you can sometimes have problems if you are the settlor and also the beneficiary. Many states in the U.S. have judiciaries that do not like people protecting their assets from creditors because, in effect, those people are protecting their assets from the legal system. So judicial activism and judicial ego have combined forces and many judges try to figure out a way to break a trust and use its assets to pay creditors. That's where it helps to have a trust that has someone else as the beneficiary. Some people also go to more extreme lengths and create trusts that are domiciled abroad.

This is just some general information from my memory. If you need specific information, a good lawyer can help you. Ask one of us and I am sure one of our lawyers can recommend someone for you in Austin.