The Key To Lawsuit Prevention & Tax Reduction Speaker: - PowerPoint PPT Presentation

F a mily Types of Assets L imite d Pa rtne rship Business Purpose? Ge ne ra l Pa rtne r(s) 1) “Any Legal Purpose” “Any Legal Asset” Home C ONT ROL Real Estate s -Co rp - 1% $ $ L imite d Pa rtne rs 2) Personal Property O wn / No t Co ntro l H - 49 1/ 2% W - 49 1/ 2% Income children, grandchildren, 100% $100,000 elderly parents

Trial Attorney’s Answer:

Passed in each individual state Would not allow ownership transfer The Charging Order from defendant to plaintiff Gave a judge the right to force a distribution and order the defendants share of the income to the plaintiff

Asset protection attorneys changed the wording so that only the general partner could order a distribution Also gave the general partner the option to take income for management or to loan money from the FLP

IRS Ruling 77-137 States: A plaintiff using the charging order will have to pay income taxes on any monetary judgment even if there is no distribution from the defendant.

WARNING!!! Nearly all limited partnerships created in America today use wording that allows a judge to order a distribution

What About an L.L.C. C-CORP SUB – S L.L.C. SOLE PROP PARTNERSHIP Will Protect Assets Inside of The Entity From an Outside Lawsuit

What About an L.L.C. C-CORP SUB – S L.L.C. SOLE PROP PARTNERSHIP Will Protect Assets Inside of The Entity From an Outside Lawsuit

The Remedy for Getting ASSETS Out of an L.L.C. is: The Charging Order

WARNING!!! Nearly all limited liability companies created in America today use the wording that allows a judge to order a distribution

L AWSUIT ( Inside ) L IMITED P ARTNERSHIP S ia bility Asse ts ) Hig h C ( RE L L L ( Ho me ) ia bility Asse ts Hig h C L L L Asse ts ( $$ ) P Sa fe L F

Typical Structures ALL Your Business & Personal Assets Joint / Individual Ownership / Sole Proprietor: $$$ Home Rental Property Vacation Home Personal Property Practice/Business Equipment (goodwill) Building What does this structure protect?

Typical Structures S, C (or P) Joint / Individual Corporation / LLC Ownership / Sole Proprietor: Owns: Home $$$ Building Equipment Personal Rental Vacation Property Property Home Practice/Business (goodwill)  Closely Held Corporation  Officer of the Corporation What does this structure protect?

Asset Protection Structure Living Trust FLP LLC LLC LLC LLC LLC Business Holds all Owns: Owns: Owns: Owns: Owns: “safe” Practice/ Business Rental Vacation Home Building Equipment assets Home Property $$$ Owns: Goodwill Rock Solid Asset Protection

RULES FOR ASSET PROTECTION 1. Establish Entities Before Lawsuit is Filed 2. Divide High Risk & Safe Assets 3. Place Safe Assets In Single FLP 4. Place All High Risk Assets in Separate Entities 5. Make Sure Entities Give Power to Distribute to The General / Managing Partner. 6. Maintain Minutes, and State Registrations

How to implement these Tools and Strategies?

Concerns for Consideration 1. Most Attorneys know very little about lawsuit prevention.

The BIG Problem #1 There are very few Asset Protection Attorneys The American Bar Association reports that LESS than .05% of Attorneys in the U.S. specialize in Asset Protection.

Concerns for Consideration 1. Most Attorneys know very little about lawsuit prevention. 2. The entities they use are not designed for asset protection

The BIG Problem #2 “Boilerplate” or “Standard” Legal Entity Documents ARE NOT designed for Asset Protection.

The BIG Problem #3 Corporate Entity Creation Is Expensive. Corporate Registration Fees are typically Low , but attorneys charge High fees for document preparation.

Concerns for Consideration 1. Most Attorneys know very little about lawsuit prevention. 2. The entities they use are not designed for asset protection 3. The Cost of entity structuring can be outrageous.

Standard Asset Protection Fees Living Trust $3,500 to $5,000 FLP LLC LLC LLC LLC LLC “C” Corp Holds all Owns: Owns: Owns: Owns: Owns: “safe” Practice/ Business Rental Vacation Home Building Equipment assets Home Property $$$ Owns: Goodwill $14,500 - $17,000 $14,500 - $17,000

The Solution

Solutions STEP ONE PREMIUM PLUS MAINTENANCE Cost of $1,200.00 per year $100.00 per month

Solutions ASSE SME NT &DOCUME NT RE VI E W Mo st E xisting Do c ume nts a re No t Asse t Pro te c tive We c a n a me nd the se do c ume nts We c a n file the a me ndme nt with yo ur sta te

Solutions Cre a ting a Blue print Pa ra le g a ls will c a ll to he lp fill o ut the que stio nna ire T he Blue Print will be c re a te d by o ne o f o ur Atto rne ys Within 10 da ys yo u will ha ve a blue print re vie w with a n a tto rne y o r a se nio r le g a l a dviso r. T his pla n will a ddre ss Asse t pro te c tio n, ta x re duc tio n a nd e sta te pla nning

Sample Blueprint Living Trust Holding “S” FLP Company Corp (LLC Taxed as FLP Holds a “ Practice/ “High “S” Corp. Business Risk” asset Holds all Owns: “safe” Goodwill assets $$$ LLC LLC LLC LLC LLC Owns: Owns: Owns: Owns: Owns: Vacation Equipment Building Rental Home Home Property

Solutions De ve lo p a T a x Pla n Mo st Ac c o unta nts do T a x Re turns no t T a x Pla ns Ma ke Sure tha t the E ntitie s Yo u Use Ha ve a T a x Purpo se Do No t Use Que stio na ble De duc tio ns We Will De ve lo p a T a x Pla n fo r Yo u E a c h Ye a r

Lawsuit Prevention ASSET PROTECTION BLUEPRINT Estate Protection Tax Management Family Living Trust Spouse 1 Joint Spouse 2 2/ 11/ 2013 Bank Accounts, LLC/FLP Interests, LLC/FLP Interests, Vehicles Corp Stock, IRA, Corp Stock, IRA, Life Insurance Life Insurance Trust Package Includes: Last Will & Testament Living Will Durable Powers of Attorney Possible Equipment, FLP (MA) (Holds and leases equipment) ABC, LLC (MA) Asset Management, Ownership: 100% owned by Family LLC DEF, PC GP: Mgmt LLC 1% Living Trust (AK & MA) (MA) LP: Spouse 48.5% (Owns SMLLC (S-corp) LP: Spouse 48.5% interests and 1% GP LP: Kids 2% in FLPs) Ownership: (Tax as Partnership) Spouse 1 - 100% Ownership: Spouse 1 - 50% Safe Asset, FLP Spouse 2 - 50% (UT) (Holds Bank Accounts, investment accounts, and other Existing Future “safe” assets) Entity Entity Ownership: GP: Mgmt LLC 1% LP: Spouse 48.5% LP: Spouse 48.5% Homestead Act: Massachusetts LP: Kids 2% TUV, LLC WXY, LLC $500,000 and $500,000 for each age (NV) (NH) 62+ or disabled person. -- Mass. Gen. L. QRS HIJ KLM NOP (amend owner (amend owner Ch. 188 §§ 1, 1A Land Trust and dist. Auth.) and dist. Auth.) Land Trust Land Trust Land Trust 100% owned 100% owned by Asset Mgmt, by Asset Mgmt, Amend to make Note : Private retirement plans are Mgmt LLC as Mgmt LLC as Mgmt LLC as LLC LLC Mgmt LLC the exempt except under special sole beneficiary sole beneficiary sole beneficiary Single Member Single Member sole beneficiary garnishment rules regarding child and Disregarded Disregarded spousal support. LLC LLC

Solutions OBSE RVE T HE F ORMAL I T I E S Annua l Me e ting s Minute s fo r Me e ting s No Co -Ming ling o f F unds No Re pre se nta tio n o f Co rpo ra te Asse ts a s Pe rso na l Asse ts

The Solution Legally Mine’s Asset Protection Program Step 2. Blueprint of Structure & Strategy Guide Draft the Structure of Your Plan on paper Prepare detailed estate structure based on:  Document Review and Assessment  State of Residency  Financial Goals  Financial Situation

Solutions STEP TWO CREATION ENTITY

Standard Asset Protection Fees Living Trust $3,500 to $5,000 FLP LLC LLC LLC LLC LLC “C” Corp Holds all Owns: Owns: Owns: Owns: Owns: “safe” Practice/ Business Rental Vacation Home Building Equipment assets Home Property $$$ Owns: Goodwill $14,500 - $17,000 $14,500 - $17,000

The Solution Legally Mine’s Asset Protection Program Step 3. Implementing the Strategies Build your Asset Protection Structure  Properly drafted corporate documents  Assist with Filing entities with State(s)  Assist with Funding the entities  Assist with creating Schedule A’s  Asset Protection Software Help & support

Our Software

The Solution Program Price $1,000. 00 per entity Pre-Payment for entities Capped @ 5,000.00

The Solution Legally Mine’s Asset Protection Program Step 4. Upgrading & Maintaining Your Plan Discounted Price in Upgrades & Estate Management Program:  Updates & Amendments  Funding kept up-to-date and ensuring goals are being met Full Annual Review of Plan:  Adjustments according to life and law changes  Consultation with you, your trustees & beneficiaries about your plan

Enrollment $6,000 Legally Mine’s Asset Protection Program What’s included:  Document Review & Assessment Today’s Price $4,000  Blueprint of Structure & Strategy Guide  Software & Support to Implement Strategies  Personal Coordinator to Help Manage Implementation

Pricing $1000 per entity the first entity will include a document review and a blue print The maximum out of pocket will be $7,000.00

Getting Started Now 95% of the people who get the program and use it get started now. If you enroll today we will reduce the price to: 12 Month Tax Return Guarantee

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