In this article, we are going to talk about two different categories of asset protection. Though there many different types of asset protection, we’ll be looking into the nature of the asset: whether it is personal or business-related. This distinction matters, as far as legal tools, planning, and taxes go.

To start, we’ll look at some definitions. 

Terms To Note 

Personal assets are items of present or future value that are owned by an individual or a household. Some common examples of personal assets include cash and its equivalents, checking and savings accounts, CFDs, physical cash, Treasury bills, money market accounts, and more. These assets are not owned by a company, corporation, or “entity.” They belong to a person or a household. 

Business assets, by contrast, are items of value that are owned by a business, company, or corporation. These assets deliver value to the business, as they are used for functions such as funding operations, driving growth, and producing goods or services. Examples of business assets include machinery, raw materials, inventory, patents, royalties, and other intangible items, and intellectual property. 

Asset protection is a term that refers to the goal of guarding your property from creditors, taxes, and other judgements. This set of legal techniques follows a body of common and statutory law. The goal is to insulate your assets, all while following the letter of the law and staying miles away from tax evasion or perjury. 

Personal Asset Protection 

Now that we’ve covered the definition of personal asset protection, it’s time to look into the various legal tools and techniques that can be used to insulate your personal property. These include: 

• Homestead Exemptions. A homestead exemption helps people save money on property taxes every year. In Florida, everyone with title to property (equitable or legal) is eligible to receive a homestead exemption up to $50,000. The first half of that $50,000 is applied to property taxes. This removes part of your home’s value from the overall taxation, appraising it as though it were worth a good deal less.
• Certain Types of Trusts. Asset protection trusts are three-party relationships that hold a person’s assets to shield them from creditors. APTs are self-settled in Florida if the person who creates the trust is also the trust beneficiary. 
• LLCs. A Limited Liability Company is a mix of partnership and corporation. It is a business structure that has the same pass-through taxation as a partnership/sole proprietorship, combined with the limited liability of a corporation. Individual business owners can classify their companies as LLCs to protect personal assets.

Though this list is by no means exhaustive, those legal tools are common ways that people protect personal assets from creditors. Likewise, there are several techniques that can insulate business assets. 

Business Asset Protection 

There are many ways to insulate your business assets. Some of these include: 

• Business Type. There are several different types of business structures in Florida, and each has their own role in shielding a business owner. Deciding how to classify your business can help protect your assets in the long run in the event of lawsuits or creditors.
• Insurance. Insurance is a good idea, no matter whether you are a business or individual. This failsafe protects your company if there is a lawsuit, disaster, or other problem. When it comes to insurance, don’t be afraid to splurge on an expansive policy. You never know when you might need it.
• Equity Stripping. Another possible way that businesses can protect their assets is through equity-stripping. This process removes the equity/value of an asset, making it unappealing to creditors. This is usually done via a separate company so that the overall assets remain the same. Once equity has been stripped, creditors cannot attack as easily.

As always, the best plan of action is to talk to a lawyer to ensure that your personal and business assets are as protected as possible. Legal counsel will be able to guide you in what tool to pick based on the facts you give them.  Contact our attorneys today. 

If you’re currently in a state of newlywedded bliss, this article might not be for you, as it is going to be a huge bummer. Let’s face it: the stats on marriage don’t look too great. The divorce rate is 44.2%. This means that if you know ten couples, four probably won’t make it. Some say that January is the most common month for divorces, while others say that it is July or August. Some even claim it is March (perhaps after Valentine’s Day’s pink-and-red haze wears off).

Whatever the month, there’s no denying that divorce is a real thing. In this article, we’re going to discuss divorce and its impact on your estate plan. If you feel, for whatever reason or inkling, that this information applies to you, read on. 

What Is Divorce? 

A divorce is the end of the legal contract known as marriage. When a court issues a divorce decree, that signals that your marriage is officially over in the eyes of the law. Divorce can take months, if not years, to finalize. According to experts, a breakdown of the marriage (arguing, lack of commitment, infidelity, etc.) is usually the biggest reason for a divorce. 

Divorce And Your Estate Plan 

Divorce might change your relationship with your ex, but it does not automatically take your ex-spouse off your estate plan as a beneficiary. Chances are, unless you saw a split coming from a mile away, your ex is in your estate plan as a beneficiary. If the divorce decree contains a stipulation to change your beneficiary designation, that’s one thing. If it contains no such clause, you’ll need to talk to an attorney. 

With a lawyer, revise powers of attorney, trusts, wills, and other documents with your ex-spouse in order to move forward. You don’t want to leave any stone unturned, and that is why it is important to sit down with a lawyer and go through your estate plan document by document. 

What Does The Law Say? 

In Florida, the law provides that a provision of a will that affects the ex-spouse of a married person is void upon divorce, annulment, or dissolution of the marriage. The divorce will not invalidate the entire will, though it does remove the spouse as a personal representative or beneficiary. It treats the spouse as though he or she has died and therefore cannot inherit or execute. 

Keeping this in mind, most lawyers agree that after a divorce, someone in Florida should not just rely on this law to cover them. Go through your estate plan and ensure that the documents officially have your ex-spouse removed. Neglecting this task will cause awkwardness at best. At worst, your ex-spouse might get a benefit from your estate when you really don’t want him or her to.

Protecting Assets From An Ex

Along this same line, you might be in a position where you want to protect assets from an ex. There are different financial tools that can help you with this, such as trusts, retirement accounts, and more. The bottom line is that divorce law and estate planning law often find themselves tied together. You don’t want to navigate this process without a lawyer. You might find yourself missing something important or getting an unfair shake from opposing counsel or the court. 

During the turbulent time of divorce, we understand that estate planning is likely the furthest thing from your mind. Some divorces are a terrible, heartbreaking tragedy. Others inspire less-negative emotions. No matter where you are on this spectrum, it’s important to contact WFP‘s legal counsel immediately to ensure your estate plan is updated after the marriage ends. 

If you’ve seen the news, whether tech, political, or otherwise, within the past few years, chances are that the word “cryptocurrency” has popped up on your feed. Cryptocurrency is a type of decentralized coinage. This digital asset is not reliant on a bank, government, or other central authority. Though cryptocurrency has its naysayers because of its volatile price and fluctuations, it seems that this digital asset is here to stay.

No matter whether you’re mining Bitcoin, Litecoin, Ethereum, or any other major, minor, or exotic coin, cryptocurrency can have an impact on your estate plan. It is, after all, an asset, and it therefore falls under the umbrella of estate planning. In this article, we’ll discuss cryptocurrency trustee services and how they work. 

Can Cryptocurrency Be Placed In A Trust? 

A trust is a tri-party fiduciary relationship. The donor, also known as a grantee, transfers title of an asset to a trustee. This second party holds the asset for the beneficiary of the third party, also called the beneficiary. At the donor’s authorization, the trustee eventually transfers title to the beneficiary. 

Though you might think of a trust as holding only cash or property, cryptocurrency can be placed in a trust. This has a lot of benefits. Namely, your cryptocurrency will not be subject to an expensive, complex probate process if you pass away. 

Some Upsides To A Crypto Trust 

Before discussing who administers a trust, it is important to talk about why putting cryptocurrency into a trust could be a good idea. It’s understandable why some crypto holders might be wary. After all, they’ve chosen a decentralized currency for a reason. That said, here are some of the upsides to a crypto trust that you should know: 

• Lessens Risk Of Loss. How do you access your cryptocurrency? Chances are, you have a wallet, password, key, and other digital safeguards that come with owning this type of asset. When you die, who knows these safeguards? If you put your crypto into a trust, there is a lower risk of it being lost after you die, as other people will have necessary information. 
• Privacy. In addition to avoid the hassle of probate, a process that can cost your beneficiaries time and money, a trust allows you to keep your crypto private. It isn’t going through probate court, so hackers and scammers won’t catch wind of it. Everyone knows about high-profile crypto hackings, and you don’t want to give these cybercriminals any reason to latch onto you. 
• Helps Beneficiaries. Your intended crypto recipient(s) won’t have to access and manage your Bitcoin or other crypto before it’s their time to do so. This relieves them of a rather immense burden, and a trusted individual with far more experience, such as a trust services company, will take over the reins. According to CNBC, 10% of people have some type of digital asset. So, companies and individuals have emerged that handle trustee services for cryptocurrency.

Trustee Services 

A trustee can be an individual, corporation, or other custodian. A trust company is a business tasked with the management, administration, and eventual asset-transfer to the trust’s beneficiary. This company acts as a custodian, and, though it can be nerve-wracking to give up control of your crypto to a company, there are some good reasons to go with a service, as opposed to appointing an individual (family member, friend, etc.).

Benefits of Trust Service Companies 

These companies can provide a lot of services to their clients from one central location. This saves a lot of time and effort, as clients do not have to coordinate financial assets, broker information, tax advisors, financial planners, and other services. These companies do charge fees, but their experience in protecting assets and managing investments makes them an attractive choice for some grantors.

If you own cryptocurrency, talk to an attorney about setting up a trust and potentially working with a trust services company. Our attorneys can help answer any questions or concerns you may have about the process.