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Re: Trusts & Personal Liability

[Subject Prev][Subject Next][Thread Prev][Thread Next] The retirement accounts are safe, and probably have nothing to do with a trust. If I remember correctly, after paying his legal team he had no assets except his NFL retirement (that's a defined benefit plan, right?) and what he had put into qualified retirement plans. He may have a lot of money in there, but it's all technically retirement money, and all protected. I would expect that he wouldn't be able to change that, either, without implications wrt the judgment.

Living (revocable) trusts are generally used for estate planning purposes. The assets may as well be in my name personally from a liability standpoint - it doesn't really protect any of it. Irrevocable trusts are just that - irrevocable. Unless an internal triggering event occurs, the letter of the trust cannot be broken. The danger of an irrevocable trust which is worded to liberally is that it may not really shield the assets properly (ability to sell principal/assets for distribution at the trustees discretion). The other downside is that irrevocable trusts are considered business entities, and pay high income taxes as a result. They are, however, generally safe from attachment (via litigation or other means) when prepared correctly. I have a revocable trust that specifies how everything gets passed to my daughter, and when. My assets will go into a irrevocable trust for her until she reaches a certain age, at which time she gets everything free and clear. For us it makes sense to set her up this way, as she is the only grandchild on both sides of the family, and an only child - she'll end up with a concentration of wealth rather than the usual dilution of wealth across generations. They can place assets directly into her trust (skipping our generation, for tax purposes).

On a side note...someone mentioned a while back about putting a business automobile in the name of a corporation to shield them from some personal liability. Unfortunately, the only time that will happen is if a non-owner employee of the business is driving the car when the accident occurs. If the owner is driving, both the owner (personally) and the business will be at risk.
David Fisher wrote:

I don't doubt it...

I just know that when the Goldmans and the Browns
Won their civil suit after he was acquitted in the criminal
Trial, they were unable to touch any of his assets, retirement money,
Etc., because they were in a "trust"

Obviously, a gross over simplification of the subject by me.

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