Charlotte Asset Protection Lawyer

Charlotte Asset Protection Attorney

Asset protection is one of the most important elements of a solid estate plan. You want to make sure that your assets are safeguarded from creditors, lawsuits, and other unforeseen financial threats. It’s a common misconception that only rich people need asset protection. If you’re concerned about the safety of your assets, an experienced Charlotte asset protection lawyer at Orsbon & Fenninger, LLP can help.

With 75 years of combined experience and board certification in estate planning and probate law, you can trust the legal team at Orsbon & Fenninger, LLP to have the knowledge, skills, and resources to help you decide and implement the right asset protection plan for your needs.

Asset Protection in North Carolina

Asset protection is a term used to describe the ways people legally protect their wealth and assets from financial threats. Sometimes people think asset protection is only needed for the very wealthy, but anyone with bank accounts, investments, or other assets should consider how they might keep them safe from unforeseen risk in Charlotte.

Bank accounts, investments, real estate, vacation or rental properties, cars or boats, or even your business might be at risk from several sources, such as:

• Taxes
• Car accidents
• Medical debts
• Divorce
• Personal legal claims
• Professional legal claims by customers or employees

Individuals in some situations may be at higher risk than others. For example, business owners, self-employed workers, and entrepreneurs are at a higher financial risk from creditors to their businesses. Certain professions, like healthcare providers, lawyers, accountants, and even chefs, may be at higher risk of litigation that could end in the seizure of assets to pay claimant damages. Older people may not qualify for Medicaid, even if they don’t have a lot of assets.

How to Protect Assets

There are several ways you can shield your assets from such threats. Using protected retirement plans, having good insurance policies, and setting up LLCs or other business structures can minimize your risk. Another common strategy is to transfer some assets into trusts. Trusts are legally binding agreements that transfer ownership of assets to a trustee, who manages the assets as detailed in the trust document.

Trusts Overview

Trusts allow more control over the distribution of assets and prevent the assets from going through the probate process. There are several kinds of trusts. These include living trusts, testamentary trusts, special needs trusts, and more. Which kinds you use will depend on your personal circumstances and needs.

The two main categories of trusts are revocable and irrevocable. A revocable trust can be changed or terminated by the owner at any time, while the owner usually can’t change an irrevocable trust once it’s set up. Because irrevocable trusts can’t be changed, they have different benefits and are generally protected from creditors and taxation.

Asset Protection Trusts

A common kind of irrevocable trust to protect property and other assets is an asset protection trust. This is a kind of legal and financial arrangement that is designed to transfer some assets from the owner’s taxable estate to management by a third party. Since these trusts are irrevocable, the owner can’t remove assets once they’ve been transferred, and creditors can’t access it either.

North Carolina does not allow domestic asset protection trusts, which makes it more complicated for residents to create one. There are still options, however, including creating an asset protection trust in a state with more favorable laws or creating a foreign asset protection trust.

Trusts Are Complex

If you want to establish a trust for asset protection, you need a knowledgeable estate planning lawyer. Trusts often require navigating complex business and family situations, and it’s crucial that the trust meets all necessary legal requirements. In addition, simple errors can cause big problems. Working with an attorney with experience in asset protection can prevent future legal and financial issues and avoid costly mistakes.

FAQs

Q: What Is a Major Disadvantage of an Asset Protection Trust?

A: A major disadvantage of an asset protection trust is losing the ability to easily access the assets you transfer into the trust. If there’s an emergency, for example, and you need to liquidate an asset quickly, you have to rely on the trustee, rather than being able to manage that yourself. However, an experienced trust attorney can help make sure your plan includes accommodations for this kind of situation.

Q: What Assets Are Protected in a Lawsuit in North Carolina?

A: In North Carolina, some assets are protected in a lawsuit. These include:

• Retirement accounts such as IRAs
• Your residence, clothes, furniture, appliances, and other household items
• Life insurance policies
• Some college savings plans
• Assets covered in an LLC or asset protection trust

Speak with an experienced asset protection lawyer to ensure you fully understand your options and to develop a customized strategy to safeguard your assets effectively.

Q: Is Asset Protection Worth It?

A: In most cases, asset protection is worth considering, even if you aren’t wealthy. While it certainly isn’t for everyone, it can be a good option to safeguard your family’s inheritance from creditors or lawsuits and ensure their inheritance is managed the way you wish. A skilled estate planning attorney can help you determine if asset protection is the right choice for you.

Q: Does NC Allow Asset Protection Trusts?

A: North Carolina does not allow Domestic Asset Protection Trusts (DAPT). However, NC does allow trusts to have a clause occasionally referred to as a “spendthrift trust.” This establishes requirements for how the beneficiary can access the assets and so offers protection for beneficiaries who have frequent financial or legal struggles. This prevents creditors from accessing the assets as well.

Asset Protection Doesn’t Have to Be Complicated

A strong asset protection plan can provide peace of mind that your assets and loved ones are secure in an insecure future. But with all the different options and complex laws, it can feel overwhelming when trying to determine what the right option is for your individual situation.

At Orsbon & Fenninger, LLP, our skilled attorneys focus on common-sense solutions for each client’s problems. Since 2001, we’ve built relationships with our clients by helping them overcome their challenges in estate planning and administration. To learn more about your asset protection options and which might be right for you, contact our office to set up an initial consultation.