All Forum Posts by: Brian Bradley

@Russell Gronsky asset protection can be very jurisdictionally driven. MD recently had a 2016 unpublished case In Kurz, et al. v. AMCP-1, LLC, denying other states Series LLCs. So though I do like the Series LLC, Asset Protection is going to be client and state specific and situation specific. The more liberal or progressive state you live in then the more likely you will see a judge give very little respect to elaborate asset protection set ups that are out of state. Again, you are in MD an have investments in MD. Possibly want to consider the MD legal system so as not to piss the judges off, and then you can always combine that with a foreign component later on as you grow for ultimate protection. 

As an asset holding company, LLCs are better asset holding companies for real estate over S-Corps or C-Corps. In fact, the shares of Corp can be attacked and attached to a judgment, then what good is that Corp? vs LLCs where they have built in limited liability protection. You just need to look up your states independent limited liability shield for LLCs.

Even though you're state does not recognize Series LLCs, you can still set up an out of state Series LLC. You will be attacked the same way an any LLC since the Series LLC is an LLC. By trying to pierce the veil. Now if that is successful, I have no idea what MD would do in relation to charging orders or damage and if they will recognize the separation of the series to stop the bleeding into other series or not. But from the case I sighted above I do not think they will,

So this then is the difference between 'maybe' protection or 'full' protection. An LLC is maybe protection since per its own words it is 'limited' and then subject to that states independent liability shield LLC laws for members, and those states charging orders.

Full protection is an 'exemption' and is automatically protected. An exemption is a right that you have under the law. So you need to talk to an MD lawyer and ask him or her what assets and amounts are exempted in MD. for example @Mike S. is in FL and FL has some really good exemptions and homestead laws. Those are fully protected and you do not have to transfer the assets or hide the. They are exempt from creditors. Then its a jurisdiction game on the rest of your non exempt assets. Anything domestic and you can never out run the constitution and full faith and credit clause. So you look for jurisdictions outside the US like a foreign Asset Protection trust in the cook islands that also has a domestic component. 

Ideally what you want is,

1. Insurance,

2. Maximize all your state and federal exemptions (homestead, 401ks, IRAs, Wages, life insurance, annuities etc). Each state has something, you just need to find out what they are and max them out first since they are absolute full protection. 

3. Set up an asset protection system for the rest of the non-exempt assets with the different tools we can use to do it (LLC, Series LLC, Land Trusts, Domestic and Foreign Asset Protection Trusts, etc).

But your facts will change and what needs to be protected will change once you max out your exemptions.

One of the things we have been talking about which is a HUGE advantage for CA residents is the Private Retirement Plan (PRP) codified in law under CCCP 704.115. The PRP is not partial or ‘maybe’ protection like other plans, but total protection. This is because exemptions are rights and involve no transferring of assets. The CA PRP is a State right, not a federal right and so does not depend on federal law for its protection status.

To claim your CA PRP rights you have to:

• 1.Qualify,
• 2.Have a formal written and adopted PRP
• 3.Not overfund the plan according to your current and future earnings,
• 4.Properly maintain and administer the plan.

The good thing also is the plan is not new. It was codified in CA in 1970 and has plenty of legislative and case law (over 47 years) to show how CA courts respect this right.

How do you set these up? With an experienced attorney familiar with PRPs and a third party administrator. Based on the statutes, the legislative history, and the case law, the following 7 essential elements will help guide you when working with your lawyer and administrator.

• 1.Third Party Administrator (TPA) – I use Trust-CFO as my firms third party administrator for my CA clients with PRPs.
• 2.Qualified diagnosis by the TPA to determine if you even qualify
• 3.Asset exemption analysis by the TPA to determine which of your assets are eligible for exemption
• 4.Funding analysis based on income, age, and retirement needs
• 5.Plan documentation and funding of plan – this is a critical step often overlooked or not done correctly. Your TPA and lawyer will help you with this.
• 6.Annual administration and review- your TPA will do this review for you.
• 7.Independent trustee

If you get sued, these elements are what the opposing counsel will be using to argue that your plan did not meet one or more standards. So when evaluating the case law, you will find a few cases where the courts allowed creditors access to the PRP due to NOT following the requirements. 

For CA residents, or for any person looking for asset protection, we have talked about the point that no one size fits all system exists for any person. Asset Protection systems are all personal and passed on you facts. Asset Protection is not about exempting assets from estate tax and avoiding probate, which has nothing to do with asset protection from creditors and lawsuits. And asset protection is not about taxes, otherwise that would be fraud. A revocable living trust does nothing to protect your assets from liability. If you simply have insurance and a living trust, you need to talk to an asset protection attorney.

Most asset protection planning is limited, especially in CA where courts have pierced the veil of LLCs set ups for asset protection. If you are living in CA, you are living in a judicial hellhole that ranked #1 by NFIB the last 3 years in a row. If your protection is "limited" as the title implies with LLC, (Limited Liability Company) and CA is a horrible state for litigation and taxes, and judges give very little respect to elaborate asset protection schemes to protect debtors (you), what option do you have? And if you are not a resident of CA, this post still applies to you.

In any asset protection system in any state, but especially for those in CA, I personally would look first towards State Exemptions and what assets I can exempt, then, after I have maxed out my exemption options with my assets, I would then look at what additional asset protection system I need to set up to protect the rest such as (DSTs, LLCs, SLLCs, Asset Protection Trust domestic or foreign,)

An exemption is a legal right under Federal or State Law to have certain assets unavailable to creditors under any circumstances. Every state has exemptions. Talk to your asset protection lawyer for your state asset exemptions. The benefit of exemptions is that they are NOT an asset transfer, therefore cannot be fraudulent or voidable. Think of each states homestead laws. Some sates like TX and FL have amazing homestead laws.

The interesting thing is, despite how bad of a state like CA is for asset protection and taxes, CA actually has VERY STRONG and UNIQUE asset protection opportunities via its CA State Exemptions for Personal Retirement Plans (PPR) found under California Civil Code 704.115.

When you actually compare these exemptions to the other States exemptions that are considered the strongest for asset protection, (TX, NV, FL) - CA is actually stronger as it relates to exemptions and private retirement plans.

Under CCCP section 704.115 no other state have an UNLIMITED state exemption for private retirement plans such as CA. In fact, the federal retirement law ERISA was modeled after it and has been around and tested in court for many years.

Yes it is hard to believe. Despite having horrible, if not the worst, climate for taxes and litigation, there is actually something CA offers its residents for protection that can convince small, mid sized business owners and investors to stay in CA and not move out of the state. Or to set up out of state asset protection systems that CA Judges cannot stand if challenged in court.

By having an experienced lawyer familiar with PRP or PRTs (interchangeably used) to properly draft and maintain a CA Private Retirement Plan (PRP) you can protect your assets via exemption. And not the limited protection under a charging order.

The surprising fact also is that CA is the ONLY state with an exempt private retirement plan (PRP).

The point is, even for you non CA residents is when talking about or considering an asset protection system, the smartest and wealthiest clients

1. Have insurance but don’t solely rely on their insurance for protection,

2. Pick up ALL their state and federal exemption they are entitled to, and

3. Then they set up some kind of asset protection entities that they need to cover the rest of the non-exempt assets, be it offshore foreign asset protection trusts, DSTs, or LLCs, S-LLCs, LP, Etc. It is then a matter of assessing the remaining non-exempt assets with protection needs and tax planning. Just remember, that these protection systems need to be tax neutral otherwise the asset transfer can be considered fraudulent. 

For CA residents, or for any person looking for asset protection, we have talked about no one size fits all system exists. Asset Protection systems are all personal. Another issue is that most ‘asset protection' attorneys are estate planning attorney's and work on exempting assets from estate tax and avoiding probate, which has nothing to do with asset protection from creditors and lawsuits. Or they stick with what they are familiar with and try to fit everybody into one system (LLC / Land trust).

Most asset protection planning is limited, especially in CA where courts have pierced the veil of LLCs set up for asset protection and pierced the veil. If you are living in CA, you are living in a judicial hellhole that ranked #1 by NFIB. If your protection is "limited" as the tile implies with LLC, and CA is horrible state for litigation and taxes, and judges give very little respect to elaborate asset protection schemes to protect debtors (you), what option do you have? I personally would look first towards State Exemptions and what assets I can exempt, then, after I have maxed out my exemption options with my assets, I would then look at what additional asset protection system I need to set up to protect the rest.

An exemption is a legal right under Federal or State Law to have certain assets unavailable to creditors under any circumstances. This is NOT an asset transfer, therefore cannot be fraudulent or voidable. The interesting thing is, despite how bad of a state CA is for asset protection and taxes, it actually has VERY strong and unique asset protection opportunities via its State Exemptions for Personal Retirement Plans found under California Civil Code 704.115. When you actually compare these exemptions to the other States that are considered the strongest, (TX, NV, FL).

Under CCCP section 704.115 no other state have a unlimited state exemption for private retirement plans such as CA. In fact, the federal retirement law ERISA was modeled after it and has been around and tested in court for many years.

Yes it is hard to believe. Despite having horrible, if not the worst, climate for taxes and litigation, there is actually something CA offers its residents for protection that can convince small, midsized business owners and investors to stay in CA and not move out of the state.

By having an experienced lawyer familiar with PRP or PRTs (interchangeably used) to properly draft and maintain a CA Private Retirement Plan (PRP) you can protect your assets via exemption. And not the limited protection under a charging order. The surprising fact also is that CA is the ONLY state with an exempt private retirement plan (PRP).

The point is, when talking about or considering an asset protection system, the smartest and wealthiest clients 1. Have insurance, 2. Pick up all their state and federal exemption they are entitled to, and 3. Then set up some asset protection entities they need to cover the rest, be it offshore foreign asset protection trusts, DSTs, or LLCs, LP, S-Corps, Etc. It is then a matter of assessing the remaining non exempt assets with protection needs and tax planning. 

For CA residents, or for any person looking for asset protection, we have talked about no one size fits all system exists. Asset Protection systems are all personal. Another issue is that most ‘asset protection' attorneys are estate planning attorney's and work on exempting assets from estate tax and avoiding probate, which has nothing to do with asset protection from creditors and lawsuits. Or they stick with what they are familiar with and try to fit everybody into one system (LLC / Land trust).

Most asset protection planning is limited, especially in CA where courts have pierced the veil of LLCs set up for asset protection and pierced the veil. If you are living in CA, you are living in a judicial hellhole that ranked #1 by NFIB. If your protection is "limited" as the tile implies with LLC, and CA is horrible state for litigation and taxes, and judges give very little respect to elaborate asset protection schemes to protect debtors (you), what option do you have? I personally would look first towards State Exemptions and what assets I can exempt, then, after I have maxed out my exemption options with my assets, I would then look at what additional asset protection system I need to set up to protect the rest.

An exemption is a legal right under Federal or State Law to have certain assets unavailable to creditors under any circumstances. This is NOT an asset transfer, therefore cannot be fraudulent or voidable. The interesting thing is, despite how bad of a state CA is for asset protection and taxes, it actually has VERY strong and unique asset protection opportunities via its State Exemptions for Personal Retirement Plans found under California Civil Code 704.115. When you actually compare these exemptions to the other States that are considered the strongest, (TX, NV, FL).

Under CCCP section 704.115 no other state have a unlimited state exemption for private retirement plans such as CA. In fact, the federal retirement law ERISA was modeled after it and has been around and tested in court for many years.

Yes it is hard to believe. Despite having horrible, if not the worst, climate for taxes and litigation, there is actually something CA offers its residents for protection that can convince small, midsized business owners and investors to stay in CA and not move out of the state.

By having an experienced lawyer familiar with PRP or PRTs (interchangeably used) to properly draft and maintain a CA Private Retirement Plan (PRP) you can protect your assets via exemption. And not the limited protection under a charging order. The surprising fact also is that CA is the ONLY state with an exempt private retirement plan (PRP).

The point is, when talking about or considering an asset protection system, the smartest and wealthiest clients 1. Have insurance, 2. Pick up all their state and federal exemption they are entitled to, and 3. Then set up some asset protection entities they need to cover the rest, be it offshore foreign asset protection trusts, DSTs, or LLCs, LP, S-Corps, Etc. It is then a matter of assessing the remaining non exempt assets with protection needs and tax planning. 

Very exciting. I’m gonna be teaching a national CLE seminar “continuing legal education” for attorneys on asset protection for the national academy of CLE.

I am very excited. I’m gonna be teaching a national CLE seminar “continuing legal education” for attorneys on asset protection for the national academy of CLE.

Very exciting. I’m gonna be teaching a national CLE seminar “continuing legal education” for attorneys on asset protection for the national academy of CLE.

Very exciting. I’m gonna be teaching a national CLE seminar “continuing legal education” for attorneys on asset protection for the national academy of CLE.

@Account Closed I think you have lost your mind. The last time I have even written about you or to you was over 2 months ago when you were well misplaced and had no clue what you were talking about and I directly replied to you then. This forum has since moved on beyond you months ago. I guess you just need to feel important again. Thanks for coming back to the forum. This forum is not about using DSTs to purchase shares as an accredited investor. Again, for the nth time. Reading comprehension Karen. Again. Everybody in this forum understands the difference as we talked about it A LOT. Look forward to your trolling me again in a few months.