Need Legal Help to Protect Your Assets?
You have worked hard for what you have so you should protect your legacy for your family and loved ones. Unfortunately, anyone may be the subject of a lawsuit, at any time. Lawsuits may arise from medical debt, foreclosure, accidents, credit card debt, and more. These actions can bankrupt a family’s future. If you want to ensure that your assets are safe from creditor seizure in the future, then the best thing to do is consult with an asset protection attorney.
Asset protection is the process of using legal techniques and strategies to guard assets from creditors. The main objective is to keep assets insulated from creditors without committing fraud or tax evasion. However, asset protection can also deter litigation and/or incentivize a favorable and early settlement if a lawsuit does arise.
Why Do I Need an Asset Protection Lawyer?
Whenever you have a considerable amount of assets, you have a lot at stake if a lawsuit or dispute ever arises. To ensure that your assets and interests are fully protected, it is best to hire an attorney. An experienced asset protection attorney can ensure that you set up your trust properly. Additionally, a lawyer can explain your legal options, and may present options and risks that you may not have considered. We can help you identify which trusts best protect your assets, for now and the future.
Can Special Needs Trust Planning Help A Disabled Person Keep Government Benefits?
Creating a special needs trust is a great way to protect your disabled loved one. There are income and asset limits for a number of public benefits, most notably Social Security Supplemental Security Income (SSI). Moreover, a disabled person that qualifies for SSI will normally automatically qualify for Medicaid (administered by MassHealth) healthcare benefits. Without proper trust planning, assets left to a disabled loved one at death can result in the disabled person losing SSI, Medicaid, and other government benefits. Considering the value of these government benefits, the assets left to a disabled loved one often pale in comparison. Thus, a well-meaning but uninformed parent of a disabled child can significantly harm that child without proper planning.
The good news is that with proper planning, you will no longer have to worry about protecting your disabled loved one. We will answer your most difficult questions and can take you through the ins and outs of different planning strategies. These strategies often include the use of third-party special needs trusts, first-party special needs trusts, ABLE accounts, and letters of intent. These strategies can insure that your disabled loved one maintains the highest standard of living possible, as well as their dignity and personal autonomy.
Asset Protection FAQs
Massachusetts offers an automatic statutory “homestead” exemption of $125,000 from the claims of creditors. By filing a “Declaration of Homestead” with the Registry of Deeds, this protection can be increased to $500,000 per family. The elderly and disabled are entitled to even more protection. If two owners qualify for elderly or disabled homestead protection, the aggregate protection on the home can be increased to $1,000,000. Note that statutory homestead protection does not protect a home from claims by MassHealth for reimbursement of nursing home costs.
A revocable trust does not provide asset protection because the creator of the trust retains the right to amend or terminate the trust at any time. A creditor could therefore force you to distribute assets from the trust to satisfy any claims. Revocable trust are most useful for estate tax planning and avoiding probate, not asset protection.
Because the creator of an irrevocable trust typically surrenders the right to terminate or amend the instrument, a future creditor generally cannot collect against the trust, at least to the extent that trust distributions to the creator are limited. Irrevocable trusts are very useful in MassHealth planning when attempting to shelter assets from nursing home costs. They are also useful when attempting to safeguard assets from the creditors of named beneficiaries. For example, an irrevocable trust can be used to ensure that a child’s inheritance is not lost if that child gets divorced.
Qualified retirement accounts are generally protected from seizure by creditors under the Employee Retirement Income Security Act (ERISA). ERISA protects most employer-sponsored retirement plans, such as 401(k) plans. Non-qualified retirement accounts, such as IRA’s and Roth IRA’s, are not protected by ERISA, though they have limited protection (generally up to $1 million) under the 2005 Bankruptcy Abuse and Consumer Protection Act. Significantly, in Massachusetts, retirement plans are generally treated as a countable resource for determining MassHealth eligibility for nursing home benefits.
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