California Private Retirement Trust (PST) and Asset Protection

[Brian Bradley]

If you are a CA resident on searching about Asset Protection you might have read some of my other forum post on DST and its benefits for CA Investors. Another option for CA investors is the Private Retirement Plan/Trust (PRT) which provides one of the highest levels of protection for your assets. With our litigious and predatory society there are few purely domestic asset protection planning strategies that offer California residents true asset protection. The great thing is that being a California resident, you have an additional option that is not well known but exclusive for CA Residents; the Private Retirement Trust (PRT).

A PRT is a retirement plan that FULLY EXEMPTS ALL trust assets from any creditor attached so long as it’s designated for future use in retirement. In 1970 California instituted its’ state exemption law that assets owned in a private retirement trust are fully exempt under statute. PRTs are specifically designed to enforce your legal exemption right to protect assets from lawsuits and attacks.

Aretax-oriented plans like IRAs seek tax deductions for contributions. PRT instead prioritize and protect private assets that already have inherent tax benefits. Instead of seeking sources of income or assets that can be used for tax deductions like IRAs, you can contribute to your PRT as they are earned with little to no restrictions on the amount. Since funds and assets are only allocated to a PRT after they have been taxed, contributions are not deductible, therefore any private or appreciating asset can be put into a PRT without limits.  If you can’t save up enough money for a traditional retirement plan or if you would like to maintain control of your assets and save for retirement on your own terms, a PRT might be for you.
Tomorrow we will get into how a PRT is different from other retirement plans and how to fund it. I plan to break the PRT down into 3 or 4 posts since their is a lot of information. If I don't get to many of the questions, it is because I want to get all the post out first, which might address the question.