Asset Protection Attorney in Honolulu, HI
Sophisticated Asset Protection Solutions in Hawaii
When you build your estate plan, you decide who will receive your assets once you are gone. Unfortunately, things do not always go according to plan. Consequences of the probate process, contested divorces, and predatory litigants can all result in your beneficiaries not receiving the full inheritances intended for them.
You deserve the confidence of knowing that your beneficiaries and loved ones will be provided for. You may also understandably wish to protect your ability to leave your legacy throughout your lifetime. At Abrell Law, our Honolulu asset protection lawyer will take a comprehensive and proactive approach to estate planning.
What is Asset Protection?
Asset protection involves a series of techniques, strategies, and laws that aim to defend the assets of individuals and their businesses against others who are trying to seize the assets. Those who are trying to seize assets can be creditors, former spouses, business partners, and the government.
Why Is Asset Protection Important?
Effective asset protection planning requires proactively anticipating and preparing for numerous types of possible threats. When your assets become imminently vulnerable, it is often too late to employ the most powerful and reliable solutions. As a general rule, asset protection measures must already be in place by the time a real threat arises.
Your Assets May at Some Point Become Vulnerable To:
- Litigation - More and more people are being subject to meritless litigation, especially if parties acting in bad faith discover that the person they are suing has considerable assets. Creditors will also sometimes resort to litigation in an effort to collect on debts. If you lose a lawsuit, a Hawaii court may grant a judgment against you. This can give predatory creditors and litigants access to your hard-earned assets.
- Taxation - As of 2021, you may be subject to Hawaii’s estate tax if you leave behind at least $5.49 million in assets. You could also be hit with the federal estate tax if your estate is worth more than $11.7 million at the time of your passing. These punishing taxes can severely limit what you can give to your loved ones once you are gone.
- Divorce - Any assets acquired during a marriage are considered “marital property” and are subject to division in a divorce. Inheritances and assets acquired before the marital relationship are generally safe from division, but you must take care to avoid “comingling” separate and marital property. You will have limited means of protecting assets in your current marriage, but you can implement tools that can protect your children and other loved ones should they experience contentious divorces.
Call Our Hawaii Asset Protection Lawyers
When you come to our Hawaii law firm for help, we carefully review your situation, listen to your concerns, and evaluate possible threats. Our asset protection attorney in Honolulu will then walk you through all available solutions that can serve your unique estate planning needs.
It is almost always in your best interest to avoid probate as much as possible. Probate is notorious for being a protracted, unpleasant, and resource-consuming process. At best, probate serves as a frustrating roadblock that prevents your beneficiaries from efficiently receiving their inheritances. At worst, it can jeopardize your asset distribution plan and do real harm to your loved ones. Fortunately, much of probate can be circumvented through asset protection planning.
Why Avoid Probate?
- When you pass away, your estate will need to be closed through the court-supervised probate process. Most assets not placed in trusts will be inventoried and eventually distributed in accordance with the instructions left in yourwill.
- Creditors may come forward during probate to make claims against your Hawaii estate. If the claims are determined to be valid, your personal representative will need to use estate assets to settle them.
- This can result in the liquidation of your assets and endanger planned inheritances, as all claims must be resolved before asset distribution can occur. Interested parties may also contest your will on frivolous grounds but nonetheless get the document thrown out.
Using irrevocable trusts and other tools can help you protect against estate taxes, litigation, and divorce
What is an Asset Protection Trust
Assets placed in trusts are in most cases not subject to the probate process. This means that any assets you place in a revocable living trust or irrevocable trust cannot generally be liquidated to satisfy creditor claims. Trusts are not as easy to contest, meaning you are less likely to see a situation where your asset distribution instructions are thrown out or ignored.
Trusts are also private, meaning their contents and your planned disbursements will not be a matter of public record. This enhanced privacy can help protect your loved ones from predatory litigants or creditors who may be incentivized to exploit lucrative inheritances.
What Is a Family Limited Partnership?
Reducing or eliminating the impact of estate taxes will require careful management of your assets. If you wish to provide for your children and/or other members of your family, it may be wise to set up a Family Limited Partnership (FLP). You can place assets in this legal business entity that you intend to eventually leave to your familial beneficiaries. Because your family members will have ownership shares in the FLP, some of the entity’s assets will not be counted when calculating your estate’s total value.
How Does Lifetime Gift Giving Work?
Lifetime gift-giving can also help you avoid Hawaii state and federal estate taxes. You will be permitted to give gifts of up to a certain value amount per recipient, tax-free, each year. Metering out gifts over an extended period of time can allow you to transfer large quantities of assets and wealth.
How Does an Irrevocable Trust Protect Assets?
One of the most powerful and popular asset protection tools is the irrevocable trust. Because the creator of the trust does not legally own the assets placed within the trust, the trust’s assets cannot in most cases be reached by creditors. Its contents will not be subject to division in a beneficiary’s divorce and will also not be counted when determining an estate’s value.
When Implemented Correctly, an Irrevocable Trust Can Protect Assets From:
- Estate taxes
- Litigation judgments
- And divorce proceedings
When you create an irrevocable trust, it is important to understand that you do not own assets transferred into the trust. A well-designed irrevocable trust will allow you to retain control of the assets without legally owning them. This severing of ownership is what in practice protects the assets. However, an irrevocable trust’s language cannot be modified once it is created, so it is critical that you seek the guidance of a seasoned Honolulu asset protection attorney when exploring this planning strategy.
Our Skilled Honolulu Asset Protection Team Is Here To Help
At Abrell Law, we will always be honest and straightforward when discussing what these tools can and cannot accomplish, and we will work together to develop an asset protection strategy that gives you the confidence you need to sleep easier. Our asset protection lawyer in Honolulu is an experienced wealth preservationist who is committed to protecting your legacy.
Our team at Abrell Law can work to ensure your asset protection solutions work in concert with the rest of your estate plan. You will work directly with our asset protection attorney to develop a strategy that provides you with the practical protections and peace of mind you deserve.
If you are concerned about the potential consequences of estate taxes, creditor claims, probate, or predatory litigation, do not hesitate to contact our Honolulu asset protection attorney onlineor call (808) 215-4223to discuss your circumstances.
Extensive Experience in LawPrior to opening up his own firm, Justin had years of legal experience working in the Prosecutor's office in Honolulu and as corporate counsel for a private business. This wide variety of settings help provide perspective on creative solutions to legal obstacles.
Culture of Compassion & TransparencyWe take your legal matter seriously. Until we resolve your case, you can expect us to listen to your needs and honestly provide solutions that are always in your best interests.
Direct Access to Your AttorneyYou won't be passed off to legal staff at any point when you work with Abrell Law. From the very beginning, you will speak with Justin so he can have a good understanding of your unique case.
Over Two Decades in HawaiiWith over 20 years living in Hawaii, serving the local community and fostering meaningful relationships is one of Justin's top priorities.
Contact us online or call us to discuss your situation, evaluate your case, and discuss your options.