Today I\u2019m going to take on the issue of bankruptcy and its relationship to asset protection. In later lessons (soon to come), we\u2019ll have lessons on Chapter 13, Chapter 11, & Chapter 7 bankruptcy filings in detail. They make sense in some cases, but there’s one overriding rule when anyone\u2019s considering bankruptcy and asset protection. By asset protection planning I mean using a trust<\/a>. Bottom line is, bankruptcy and asset protection normally don\u2019t mix, they\u2019re like oil and water.<\/p> Why\u2019s this? It\u2019s because of some new provisions in the Bankruptcy code which brings protected assets back into the Bankruptcy Estate in some cases. Trusts, which were funded less than 10 years ago are particularly vulnerable.<\/p> There’s a 10-year clawback. So unless you’re planning this more than 10 years old and having a trust funded before that 10 years, bankruptcy acts as an anathema to it. You don\u2019t want to have your plan subjected to a Federal judge, who\u2019s the closest thing to God on earth, who has been appointed for life. Bankruptcy judges are not to be messed with. So, don\u2019t mess with them. If you’re considering an asset protection trust and bankruptcy, go bankrupt first. Never ever consider bankruptcy as an option once you\u2019ve done offshore or even onshore asset protection planning using a trust. That\u2019s the basic part of this rule.<\/p> With that said, I have taken people with old asset protection plans that have existed for more than ten years. I\u2019m talking- I’ve taken 11 or 12-year-old plans through Chapter 7 and other types of bankruptcies.<\/p> I don\u2019t do bankruptcies.<\/strong><\/em> I am not a lawyer. I don\u2019t do any of that stuff; but I get in the middle of it a lot and I’ve taken them through the bankruptcy process and their trusts remained untouched, but their trusts were very old and no games had been played. <\/p> My clients didn\u2019t fudge any rules. They completely disclosed everything; and so it can work but in 99% of the cases, just remember bankruptcy and asset protection trust do not mix.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t Bankruptcy and Asset Protection Don\u2019t Mix If you’re considering an asset protection trust and bankruptcy, go bankrupt first GET STARTED ON YOUR ASSET PROTECTION PLAN Share on facebook Facebook Share on twitter Twitter Share on linkedin LinkedIn Share on whatsapp WhatsApp Share on email Email Today I\u2019m going to take on the issue of bankruptcy […]<\/p>\n","protected":false},"author":49,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[45],"_links":{"self":[{"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/posts\/481"}],"collection":[{"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/users\/49"}],"replies":[{"embeddable":true,"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/comments?post=481"}],"version-history":[{"count":0,"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/posts\/481\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/media?parent=481"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/categories?post=481"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.assetprotectiontraining.com\/wp-json\/wp\/v2\/tags?post=481"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n\t\t\t\t\t\t\t