Asset Protection Lawyer in Colorado Springs
Helping Clients Preserve Their Legacies
Effective estate and financial planning should include a thorough asset protection strategy. Asset protection planning happens through the use of legal tools that help individuals or businesses protect assets from creditors, lawsuits, and other financial threats. Many people use asset protection as a means of preserving assets or wealth until a future date or ensuring that family wealth safely passes to succeeding generations.
When you have questions about asset protection planning and which strategies to choose for you and your family, turn to Peakstone Law Group, LLC for help. We empower our clients with dedicated service and savvy legal strategies. At our firm, you can expect our team to treat you like a person, not a file number. We’ll ensure that you understand your legal options and make ourselves available 24/7 to give you the help you need when you need it.
Contact our firm at 719-689-8861 today for a free initial case evaluation with a Colorado asset protection attorney. You can get the answers you need from our asset protection lawyers and start developing a tailored asset protection and estate plan that preserves your family’s wealth.
Why Asset Protection Planning Is Important
Asset protection is a type of financial planning that aims to protect wealth from creditors, financial liabilities, and poor financial and personal decisions.
As people age, they accumulate assets they want to protect for their own use and to provide for the loved ones they’ll leave behind. This can include physical assets, such as real estate, or more complex holdings like retirement accounts. You may want to ensure your family can always keep the home you’ve worked hard to buy, or you may want to provide your children or grandchildren with a financial head start when they go to college or begin their adult lives.
Asset protection ensures that you can put your hard-earned wealth out of the reach of creditors and achieve your estate planning goals, including having the resources you need for your advanced years and passing on inheritances to your loved ones.
Do I Need to Consider Asset Protection?
Even though you currently may not have significant debt or liabilities, your financial circumstances could suddenly change. For example, you may incur substantial medical debt due to a health emergency, or you may become a defendant in a personal injury case.
Unexpected debts and liabilities can wipe out a lifetime of hard work and wealth-building. Having an asset protection strategy in place will ensure that you and your family have the tools you need to protect and preserve your wealth.
How Can You Protect Your Assets From Creditors?
You may have multiple avenues to protect your assets from seizure by creditors. Some of the most commonly used asset protection strategies against creditor claims include:
Asset Protection Trusts
Individuals and families may set up one or more trusts to hold assets to shield them from creditors. When structured properly, an asset protection trust can name the original asset owner as a beneficiary, enabling them to continue enjoying or benefiting from the protected assets.
Irrevocable Trusts
Most asset protection trusts use the irrevocable form of trust. Irrevocable trusts provide more robust protection from creditors because the grantor who funded the trust cannot withdraw or control those assets. They can also provide some tax savings. An attorney can help you establish the proper trust structure and explain what you can and cannot do if you wish to maintain the legal protections.
Spendthrift Trusts
These trusts enable families to pass personal assets and inheritances to loved ones without worrying that a loved one might dissipate their inheritance due to heavy debt, poor financial decisions, or personal issues like gambling or substance addictions.
Special Needs Trusts
Families with a loved one with special needs who receives means-tested government benefits can use special needs trusts to protect the individual’s assets, such as inheritances or personal injury awards, while preserving their benefits eligibility and providing an income stream to increase their quality of life and financial stability.
Medicaid Planning
People who expect to require long-term skilled nursing care may engage in Medicaid planning to ensure their eligibility for benefits to help cover the cost of long-term care. This often involves establishing a Medicaid Asset Protection Trust to shelter assets and meet Medicaid eligibility thresholds while still allowing assets to pass to loved ones.
Declarations of Homestead
Most states allow homeowners to obtain a homestead exemption, which protects a certain amount of equity in a primary residence from seizure by creditors (other than mortgages on the property). However, there are limits to be aware of, so it’s important to discuss this option with an attorney to ensure you understand how it fits into your larger asset protection plan.
Tax-Free Gifts
Families can use tax-free gifts as an asset protection strategy in an estate plan. State and federal tax codes permit people to gift up to a particular dollar value of cash or assets without the donor or recipient incurring any tax liability. However, there are strict rules on how this works, and making a mistake could make you vulnerable to fraudulent transfer claims.
Limited Liability Companies
If you are a business owner, forming an LLC can legally separate your business and personal assets. This means that personal creditors wouldn’t be able to go after your business assets or profits, and vice versa. There are specific processes that must be followed under this option to ensure you don’t inadvertently pierce the corporate veil, so it’s best to work with an attorney.
Which Creditors Can Sue Me?
A major part of creating an effective asset protection plan is understanding who you’re trying to protect the assets from. A person may incur financial obligations to various parties who can pursue payment through the courts. An asset planning protection strategy can shield assets and wealth from seizure by creditors, such as:
- Student loan providers, a significant concern because student loans can’t be discharged through bankruptcy
- Credit card companies
- Auto loan providers
- Personal loan providers
- Mortgage holders
- Medical providers and medical debtholders or lienholders
- Judgment creditors (for example, personal injury or breach-of-contract judgments)
- Former spouses or partners (for example, property division, alimony, and child support)
If you’re not sure what creditors you have now or may be subject to in the future, our attorneys can help. We’ll talk with you about your current financial situation and future goals to determine the right strategy for your needs. Contact us at 719-689-8861 to get help today.
Should I Combine My Estate Plan With Asset Protection Planning?
Your estate plan should consider asset protection as a key goal. Estate planning ensures you have the resources you need as you age and develops a strategy to pass your hard-earned wealth to your loved ones after your death.
Asset protection in estate planning can help you reduce your family’s financial liabilities, including estate taxes and liabilities to current and future creditors. As with estate planning, your asset protection plan will evolve as your personal, familial, and financial circumstances, goals, and priorities change.
It’s also important to be aware of the limits of certain asset protection tools, such as domestic asset protection trusts, to ensure that you’re fully covered. An attorney can help you understand how combining these tools with a larger estate plan can ensure your assets are as protected as possible, whether you’re trying to preserve wealth for future generations or want to ensure your legacy goes to a meaningful charity.
Contact Peakstone Law Group for Comprehensive Asset Protection Planning Advice
When you need help developing an effective asset protection strategy in Colorado Springs, turn to Peakstone Law Group for tailored estate and asset protection solutions from our knowledgeable wealth preservation attorneys in Colorado. We’re dedicated to creating custom plans that reflect the needs and goals of our clients to bring peace of mind now and security in the future.
Contact our firm at 719-689-8861 today for a free, confidential consultation to discuss the asset protection tools our team can use to help you protect your legacy. We’re ready to help you and your family plan for the future.