Asset Protection Trusts
The protection of assets and their transfer to future generations is one of the most important financial activities you will undertake in your lifetime. Holland & Knight’s Asset Protection Trusts Team skillfully guides you in choosing the optimal path for building a protective barrier around your assets.
Because asset protection trusts (APTs) are not stand-alone devices, but rather part of an overall wealth preservation and management plan, you will benefit from a legal team that can draw from the broadest experience possible to inform your strategy. Holland & Knight’s diverse and seasoned team works closely with you to guide you through investment, insurance, income tax and estate planning, and ultimately, to help you navigate the appropriate circumstances for asset protection.
Hallmarks of an Asset Protection Trust
Our lawyers are well-versed in APTs and tailor our counsel to each of our client’s unique objectives and situations. Our attorneys have a breadth of experience in business and tax law and are dedicated to effective and creative asset protection planning.
Holland & Knight’s Asset Protection Trusts Team understands the basics of APTs. APTs have been used for many years to shield assets from potential creditors, while preserving them for the use of the beneficiary. APTs have historically been formed in offshore jurisdictions such as Bermuda, the Isle of Man, the Cook Islands and various Caribbean nations. Gaining favor today, in an era of unprecedented litigation, domestic APTs have been authorized in 11 United States jurisdictions: Alaska, Delaware, Missouri, Nevada, New Hampshire, Oklahoma, Rhode Island, Utah, South Dakota, Tennessee and Wyoming.
Although domestic APT statutes vary in their details, they share some common traits:
- transfer to irrevocable trust
- resident trustee
- specific incorporation of state law
- inclusion of spendthrift clause
- grantor’s retained interests
- time periods for extinguishing claims
Meeting the Needs of a Wide Range of Professionals
Because domestic APTs are used to defeat future potential creditors and are favored by those in high-risk professions, Holland & Knight lawyers have worked with a diverse client base that includes:
- doctors and dentists
- individuals exposed to lawsuits arising from negligence, intentional torts and contractual claims
- officers, directors and fiduciaries
- real estate owners with exposure to environmental claims
- real estate developers to avoid recurring risk to assets
Protection in Adverse Situations
When an adverse situation exists, Holland & Knight’s Asset Protection Trusts Team has a breadth of experience to represent you and minimize your risk. Our lawyers will work for your long-term financial goals through asset protection, no matter your adversity; however, it is wise to note that asset protection plans generally are not effective when there is an outstanding judgment or a pending or expected claim.
How a Domestic APT Can Work for Your Benefit
Our attorneys help you navigate asset protection trusts and advise you on how to make an asset protection trust benefit you by solidifying your overall wealth preservation and management plan.
Our team will counsel you on how APTs:
- provide protection of substantial assets
- allow the family to access funds as needed
- permit structuring to avoid gift, estate, state and local income taxes on trust income, including large gains on sales of property
- allow the family to be involved in distributions from the trust
- allow the family to appoint and remove trustee
- protect the family from claims such as divorce of a family member