Basic Asset Protection in Tennessee
Basic Asset Protection in Tennessee
How do you achieve asset protection? How do you best limit your liability and protect the assets and investments you have spent so much of your life building up? While you cannot completely eliminate exposure to potential liability, you can achieve asset protection through the use of simple techniques, like buying the right kind of insurance, or through the use of more sophisticated tools like asset protection trusts.
General Layers of Asset Protection Planning
- Purchase Protective Insurance. Examples: long-term care insurance, professional liability insurance, and umbrella personal liability coverage. Insurance is the simplest and most affordable way to protect your assets. When our clients ask us if we think they have enough insurance, we always tell them that you can never be over insured.
- Utilize Statutory Law Protections. Examples: ownership of real estate as tenants by the entireties, homestead exemptions, retirement plans, and life insurance or annuities. Real property owned by a husband and wife as tenants by the entirety is exempt from the separate creditors of each spouse. Additionally, other statutory protections provide that specific assets may be protected from creditors in certain circumstances. For example, in Tennessee, life insurance passing to a surviving spouse or child passes free of the claims of a decedent’s creditors. You should consult an attorney to find out which of your assets may be statutorily protected.
- Domestic Asset Protection Trusts. Tennessee is only one of a handful of states that has a specific statute allowing an individual to create a self-settled asset protection trust. This means that a person can create the trust, have control over certain aspects of the trust, and also be a beneficiary of a trust. The rules governing these types of trusts are very specific. These types of trusts are also available in Mississippi, Delaware, Alaska, and Nevada. If you are interested in learning more, click here.
- Domestic Entity Planning. Example: Wyoming Close LLC. An LLC, unlike a corporation, allows the members of the entity to separate their personal liability from their liability as members of the company. The most enticing feature of an LLC is the fact that a creditor of the LLC cannot attach the personal assets of the LLC’s members. We prefer using a Wyoming LLC because the laws in Wyoming are among the most favorable in terms of the protection an LLC provides.
Need an Asset Protection Attorney to Help Protect Your Assets?
Asset Protection Planning 101
It is not uncommon for people to have diligently planned and saved for financial security yet fail to implement any type of plan to protect those assets they have amassed. This leaves them vulnerable to asset seizure in the event they lose a lawsuit or are pursued by creditors. This is why it is so critical to work with a seasoned attorney who specializes in asset protection. The attorneys at Patterson Bray PLLC can sit with you and go over asset protection 101 in a way that is understandable and reassuring.
Benefits to Asset Protection
There are many benefits to having taken the steps to legally protect your assets. These can include:
- Asset protection from creditors
- Asset protection from divorce settlements
- Asset protection from excessive medical bills when no health insurance or limited health insurance coverage exists
- Asset protection from lawsuits
- Asset protection from nursing homes or other assisted living facilities
- Business asset protection from lawsuits, creditors, or other claims
- Inheritance protection for adult children from divorce and/or creditors
Working with Our Asset Protection Law Firm
When you work with an attorney from Patterson Bray PLLC, we will work to develop strategies that will be specifically made for your situation. Some of the more asset protection 101 tools we can utilize include trusts and Family Limited Partnerships (FLP). Your attorney will also examine the different retirement accounts our clients have to ensure that they are maximizing the contributions made to their pension, 401(k), and IRAs. This not only benefits the client in increasing the amount of money they will have saved when they retire, but it also protects those assets in the event a creditor wins a judgment against the client or they lose any other type of lawsuit
Your asset protection attorney may also tell you that increasing the amount of insurance coverage you have may be beneficial. This can include homeowner’s insurance, business insurance, or a personal umbrella policy. Having significant liability insurance coverage can help minimize risks to your assets in the event of a lawsuit.
If you are a small business owner, your attorney will also examine the type of business structure you have set up. This can help to ensure that your personal assets are protected from any business liabilities that may arise. This is often done by creating a Limited Liability Company (LLC). By forming an LLC, small business owners will not be personally liable for any debts, judgments, or other liabilities of the business, and their personal assets and property are protected.
Call Our Office Today
If you would like to learn more regarding asset protection 101 and how to protect your family and/or business in the event of legal or financial issues that may arise, call Patterson Bray PLLC to schedule a free and confidential consultation.
By: Carlisle Dale
8001 Centerview Parkway, Suite 103
Memphis, Tennessee 38018
(901) 372-5003 Office
(901) 383-6599 Fax