• Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Anderson, Dorn & Rader, Ltd

Reno Estate Planning Attorneys

  • Home
  • About Us
    • About Our Firm
    • Communities We Serve
      • Carson City
        • Churchill County
          • Fallon
      • Douglas County
        • Gardnerville
        • Minden
      • Lyon County
        • Dayton
        • Yerington
      • Washoe County
        • Incline Village
        • Reno
        • Sparks
    • Meet Our Team
    • News & Events
  • Services
    • Advanced Estate Planning
      • Estate & Gift Tax Planning
    • Asset Protection
    • Trustee Services
    • Financial & Investment Planning
    • Foundational Estate Planning
      • Estate Planning Services
      • Inheritance Estate Planning
      • Incapacity Planning
      • IRA & Retirement Planning
      • Legacy Wealth Planning Reno
    • LGBTQ Estate Planning
    • Pet Planning
    • Probate & Trust Administration
    • SECURE Act
    • Special Needs Planning
  • Resources
    • Blog
    • DocuBank
    • Estate Planning Resources
      • Estate and Gift Tax Figures
      • Estate Planning Articles
      • Estate Planning Definitions
      • Free Estate Planning Worksheet
      • Is Your Estate Plan Outdated?
      • Top Estate Planning Techniques
    • F.A.M.E.
    • Frequently Asked Questions
      • Asset Protection
      • Estate and Gift Tax
      • Estate Planning
      • LGBTQ Estate Planning
      • Pet Planning
      • Probate
      • Probate and Trust Administration
      • Special Needs Planning
    • Newsletters
    • Pre Consultation Form
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Estate Planning For Niches
      • Trust Administration
    • Top Five Ways to Avoid Probate
    • Trust Administration Checklist
    • Videos
  • Events
  • Contact
  • Reviews
    • Our Reviews
    • Review Us
    • (775)  823-9455
    • ATTEND AN EVENT
Anderson, Dorn & Rader, Ltd.
Home » Estate Planning » Asset Protection Mistakes Nevada Residents Must Avoid

Asset Protection Mistakes Nevada Residents Must Avoid

July 27, 2016 by Gerald M. Dorn, Estate Planning Attorney

mistakesIt is relatively easy to understand how important asset protection planning for Nevada residents can be.  Most people want to make sure their assets are protected, including real estate, investments, business interests, and even personal property.  Just consider the costs of malpractice, business (E&O), and other forms of liability insurance, which are rapidly increasing.  It is certainly important to be preemptive in protecting your assets from potential creditors, whether that is through an insurance policy, homestead, or other asset protection plan.  What may be even more important is understanding the most common mistakes in asset protection that Nevada residents should avoid.

There is nothing illegal about asset protection planning

One common mistake that many people make is assuming that there is something wrong with creating a plan to protect your assets.  Many people feel like they are “hiding assets” or irresponsibly “sheltering” their estate from the reach of creditors.  That simply is not true.  We are all free to structure our assets in the most advantageous way available, as long as we do so properly and in accordance with the law.  The only time that the issue of fraud is raised is when the purpose of an asset protection plan is solely to hinder, delay, or defraud creditors from collecting valid debts.  The key is to create your asset protection plan before the creditors’ claims arise.

Make your plan before problems arise

Plan in advance!  Another mistake that some individuals make is not taking action to protect their assets until after a problem has arisen.  If you’ve already been sued (or if you know you’re about to be sued), it’s likely too late to effectively create a plan.  The best and most effective asset protection planning is accomplished long before any creditor claims arise.  The best time to start an asset protection plan is when you are solvent and not currently facing any threats from existing creditors.  The purpose of asset protection planning is to protect from potential future creditors.  The sooner you start planning, the more options will be available to you.

It can be tricky determining who may be a potential creditor

One aspect of asset protection planning that is difficult for most people is making a proper determination of who is likely to be a potential creditor.  Those who are able to make this determination are better able to make an effective asset protection plan.  It is easier to plan when you know exactly what you are planning for.  In other words, if you can implement a strategy to protect against certain claims you can more easily limit your exposure to that liability.  Some common ways to avoid liability, especially for business owners, include:

  • avoiding high risk real estate and other investments,
  • exercising extra care in hiring employees,
  • refusing to loan cars, boats and other dangerous instruments to others,
  • avoiding joint ownership in dangerous instruments, and
  • including indemnification language in contracts.

Customize your asset protection plan to fit your needs

You cannot rely on an asset protection plan someone else used.  Friends may be well-intentioned, but one size definitely does not fit all when it comes to asset protection planning.  Not every protection strategy will work in every case.  Any estate planning attorney will tell you – an asset protection plan needs to be developed on a case by case basis.  Some people can effectively create an asset protection plan by taking advantage of legal protections under homestead, ERISA, business, and other federal and local laws; still others may need a more complex asset protection trust to deal with potential creditors.  Individual needs must be carefully considered when choosing your planning options, so don’t use a boilerplate plan and hope that you will be protected.  Most likely, you will not.

Make sure you create the right type of trust

Many clients have the same misconception, that any type of trust can provide asset protection.  That is not the case.  First, revocable living trusts do not provide protection for individuals who created the trust simply for that purpose.  It is important to remember that, in most states, when the person who has funded the trust is a potential beneficiary, then the assets may not be protected from creditors.  However, a properly drafted revocable living trust may be able to add asset protection for surviving spouses and/or other beneficiaries.  An irrevocable trust can only protect property that is transferred to the trust as long as there is no evidence of a fraudulent conveyance, and a statutory period of time has passed before a creditor claim arises.  Foreign offshore trust accounts have come under scrutiny in United States Courts, recently.  Very special care must be given when implementing an asset protection plan that includes an offshore account.

The lack of a proper estate plan can be an issue

A part of asset protection planning necessarily includes consideration of possible inheritances from relatives, a factor that is often overlooked.  Those inheritances must be structured, as well, in order to provide maximum flexibility, as well as, protection against creditors and divorce.  An estate plan is a way for you to prepare yourself and your family for what happens after you pass away.  An appropriate estate plan can also give you an opportunity to plan for unexpected incapacity.  Regardless of how few assets you may have, planning for your family’s future is a necessity for everyone.
If you have questions regarding mistakes in asset protection, or any other asset protection planning needs, please contact Anderson, Dorn & Rader, Ltd., either online or by calling us at (775) 823-9455.

  • Author
  • Recent Posts
Gerald M. Dorn, Estate Planning Attorney
Gerald M. Dorn, Estate Planning Attorney
Gerald Dorn is a shareholder and has been a partner at Anderson, Dorn & Rader, Ltd. Since 1998. Mr. Dorn has extensive experience serving wealthy families and business owners in the development of estate, tax and asset protection planning strategies. He made the decision to focus his practice in the area of estate planning after witnessing the personal grief and financial loss suffered by several of his clients as a result of poor planning. These experiences motivated him to dedicate his professional life to assisting his clients to preserve their life’s work for their heirs and to create a lasting legacy for those they love. Mr. Dorn is able to accomplish his mission through the use of a vast number of estate planning tools, both basic and advanced, for all of his clients at Anderson, Dorn & Rader, Ltd.
Gerald M. Dorn, Estate Planning Attorney
Latest posts by Gerald M. Dorn, Estate Planning Attorney (see all)
  • Getting Ready for 2021 - December 15, 2020
  • Myths We Tell Ourselves About Estate Planning - October 13, 2020
  • Living Trusts Streamline the Estate Administration Process - June 8, 2020

Filed Under: Advanced Planning, Asset Protection Planning, Estate Planning, Family-owned Businessess and Farms, IRA & Retirement Planning, Small Business Planning, Wealth Preservation

Primary Sidebar

Anderson, Dorn & Rader, Ltd

Blog Subscription

Free Estate Planning Worksheet

Follow Us

  • Facebook
  • LinkedIn
  • RSS
  • Twitter
  • YouTube

Reno Office

Reno
500 Damonte Ranch Parkway
Suite 860,
Reno, NV 89521
United States (US)
Phone: (775) 823-9455

Reno Office Map

map

Reno Office Hours

Monday8:30 AM - 5:00 PM
Tuesday8:30 AM - 5:00 PM
Wednesday8:30 AM - 5:00 PM
Thursday8:30 AM - 5:00 PM
Friday8:30 AM - 5:00 PM

Minden Office

Minden
1692 County Road
Suite A,
Minden, NV 89423
United States (US)
Phone: 775-823-9455

Minden Office Map

map

Minden Office Hours

By Appointment Only, Call For Details

Footer

About the American Academy | Disclaimer | Privacy Policy | Site Map | Contact Us
Anderson, Dorn & Rader, Ltd
All Rights Reserved.

Attorney Advertisement
Anderson, Dorn & Rader, Ltd. Logo

© 2021 American Academy of Estate Planning Attorneys, Inc.

  • Facebook
  • LinkedIn
  • RSS
  • Twitter
  • YouTube