Jun 182014
 
The Supreme Court Proclaims Inherited IRAs Are Not Protected From Creditors

On Friday June 13, the U.S. Supreme Court in the case of Clark v. Rameker, proclaimed that an inherited IRA is not an exempt asset for bankruptcy. The broader reading of this opinion is that children who receive an inherited IRA from Mom or Dad may end up losing the IRA funds to a creditor as the IRA is not creditor protected in the hands of the children. In addition, should the children need to go through bankruptcy to get a fresh start on their financial situation, the IRA will be a reachable asset for creditors. Certainly, the easiest and More…

Aug 302012
 

As a follow-up to the previous post regarding 4 life changing events that require an estate planning review we now turn to three property transactions that should also lead to a review of an estate plan. Going through probate: It is no secret that longer life spans, ballooning medical costs, and two recessions have been negative factors on the average inheritance these days.  That said, whatever the amount is, there will be even less of it if creditors come calling or if it passes through another probate.  Any time a person receives a large sum of money or property, they More…

Jul 272012
 
Planning For The Transition Of Your Digital Estate

It is no secret that more and more of our daily lives are being carried on digitally.  Online bank and brokerage accounts, bill payments services, credit cards, and social networking accounts are just a few components of the modern digital estate.  While many people would agree that their digital assets have real value, not nearly as many are taking steps to ensure that the transition of their digital estate upon their passing is a smooth one. So what are some things that can be done to remedy this problem?  A few examples include: Record digital assets and access requirements.  Make More…

Jul 102012
 
Protecting Your Assets From Your Teenage Drivers

Many people are unaware that, under Florida law, a motor vehicle is considered a dangerous instrumentality and an owner of a vehicle who allows someone else to use it has a legal obligation to insure that the vehicle is safely operated.  If the person borrowing the vehicle damages property or causes personal injury, the owner is as considered as liable as the operator. This legal doctrine can cause serious issues for parents who have teenage drivers that are using their cars.  If the child operate the car negligently and causes an accident, the parent can be held liable as the More…

Jun 052012
 
Court Rules That $500,000 Found in House Walls Belongs to Estate, Not Homeowners

An Arizona appeals court has ruled that $500,000 found in the walls of a house belongs to the heirs of the man who put it there and not the current owners. Apparently, before he died the decedent had a habit of hiding cash and other valuables in unusual places in the homes he lived in.  After he passed away, his two daughters found stocks and bonds, as well as hundreds of military-style green ammunition cans containing gold or cash, hidden throughout his home.  After seven years of searching, the daughters sold the home to a couple who planned to do More…

Jun 012012
 
Insurance May Not Be Enough To Protect A Business Owner’s Personal Assets

Previously, we discussed piercing the corporate veil and the role that maintaining adequate insurance can play in determining whether a piercing action will succeed.  But what happens when insurance is not enough?  This is the time when a personal asset protection plan comes into play. It is no secret that insurance companies are in the business of making money and that a large part of their business is generated through the denial of claims.  After all, is it not preferable from their standpoint to bring in all those premiums and pay out nothing at all?  Take, for example, the story More…

May 232012
 
Lack Of Insurance May Be Justification For Piercing The Corporate Veil

Last week we discussed the legal phenomenon known as “piercing the corporate veil”.  If judgment creditor succeeds in a piercing action, courts can ignore the corporate liability shield and hold the individual owners of the company personally responsible if there is not enough assets in the company to satisfy their judgment.  This often happens when the evidence shows that the business did not follow proper corporate formalities, when owners commingle business funds with personal funds, or where the owners failed to adequately capitalize the business. When the company does not have insurance, or has not purchased enough insurance to keep More…

May 162012
 
Forming A Company May Not Be Enough To Protect An Owner’s Assets

Many people are familiar with the basic liability protections afforded to the owners of a business entity such as a Florida LLC, corporation, or limited partnership.  These legal structures allow for the protection of their owners from personal liability in the event of a successful lawsuit against the company.  However, what may not be as well-understood is the fact that this protection is not absolute.  Courts can and will ignore the corporate liability shield if the circumstances call for such treatment.  This legal doctrine is known as “piercing the corporate veil.” If challenged in a lawsuit, IRS audit or other More…

Dec 082011
 
Florida’s Protection Of Retirement Accounts

As the end of the year rolls around, individuals are seeking to make contributions to their retirement accounts, in order to save for retirement as well as secure a tax deduction on their 2011 returns.  Florida residents will be happy to know that they enjoy broad and comprehensive protection of their retirement accounts from the claims of their creditors.  Florida Statute 222.21(2)(a) states that “any money or other assets payable to an owner, a participant, or a beneficiary from, or any interest of any owner, participant, or beneficiary in, a [retirement] fund or [retirement] account is exempt from all claims More…

Nov 102011
 
The Benefit Of Converting A Florida Corporation Into An LLC

Previously, we published a blog detailing the 2011 Florida legislation which established that a charging order is the sole remedy available to a creditor who holds a judgment against a member of a multiple member LLC.  Following this development, the use of a Florida multiple member LLC to obtain asset protection now appears to be a well-established facet of Florida law.  Conversely, stock ownership in a Florida corporation is freely attachable by an individual’s creditors.  These asset protection benefits, along with the flexibility of the Florida LLC statutes and the lower general cost to operate a Florida LLC when compared with More…