Sunday, May 14, 2017
Friday, May 12, 2017
What Attorneys' Don't Tell You - LLC and Revocable Trust Myths
"Wills, Revocable Trusts and Probate"
There is a significant disconnect between the hype and reality surrounding revocable or living trusts. Attorneys promote them as a probate avoidance estate strategy and because they are easy to organize (attorney like easy money) and NOT because they best serve clients (in our humble opinion).
THE LAW FIRM SAYS...
"A revocable living trust is an alternative financial planning solution that allows your assets to be protected based on the unique situations of each phase of your life, without having to go thought probate."
THE UNIFORM PROBATE CODE SAYS...
The Prefatory Note to the Uniform Trust Code states that the “basic policy [of the Code] in general is to treat the revocable trust as the functional equivalent of a will. Similarly, its section 112 provides that rules of construction applicable to wills also apply “as appropriate” to trusts. While revocable trusts clearly are commonly used as will substitutes, fundamental differences between revocable trusts and wills support the UTC’s qualification of the basic doctrine that wills law should apply to revocable trusts.
So, there is legal precedent and a solid basis on which the facts shared with you are made, and the stage is set for you to fall victim to the Probate nightmare in some form or fashion.
AND THE AKRON SCHOOL OF LAW SAYS...
"Because contesting a revocable trust after a decedent’s death is analogous to contesting a will, and because the UTC treats revocable trusts as the functional equivalent of wills, presumably standing issues in UTC jurisdictions will be resolved by reference to the law of wills."
If one of your Cupcake Kids or grand kids feel “shortchanged” or “stiffed” not only can they contest a Will in Probate , they can now contest the Revocable Trust or other revocable structure.
"The LLC Myth"
Does frozen distributions and assets sound like asset protection? It is not! Frozen distributions and assets from temporary or permanent injunctions and enforcement of judgments through the LLC charging order (and every LLC has the charging order provision, some more worse than others) is the risk that you face if your LLC is successfully attacked and has insufficient or no insurance to protect against the particular attack.
Dunkin Donuts knows this which is why they have DD IP HOLDER LLC and Dunkin' Brands Group Inc. NASDAQ symbol (DNKN)
All of the intellectual property, such as the Dunkin Donuts name, logos, etc., are owned by a subsidiary (a holding company) known as DD IP Holder LLC. Take a look at the side of one of their plastic cups.
Operating your personal affairs (and some level of business operations) in private unrecorded trusts has many advantages.
There is a significant disconnect between the hype and reality surrounding revocable or living trusts. Attorneys promote them as a probate avoidance estate strategy and because they are easy to organize (attorney like easy money) and NOT because they best serve clients (in our humble opinion).
THE LAW FIRM SAYS...
"A revocable living trust is an alternative financial planning solution that allows your assets to be protected based on the unique situations of each phase of your life, without having to go thought probate."
THE UNIFORM PROBATE CODE SAYS...
The Prefatory Note to the Uniform Trust Code states that the “basic policy [of the Code] in general is to treat the revocable trust as the functional equivalent of a will. Similarly, its section 112 provides that rules of construction applicable to wills also apply “as appropriate” to trusts. While revocable trusts clearly are commonly used as will substitutes, fundamental differences between revocable trusts and wills support the UTC’s qualification of the basic doctrine that wills law should apply to revocable trusts.
So, there is legal precedent and a solid basis on which the facts shared with you are made, and the stage is set for you to fall victim to the Probate nightmare in some form or fashion.
AND THE AKRON SCHOOL OF LAW SAYS...
"Because contesting a revocable trust after a decedent’s death is analogous to contesting a will, and because the UTC treats revocable trusts as the functional equivalent of wills, presumably standing issues in UTC jurisdictions will be resolved by reference to the law of wills."
If one of your Cupcake Kids or grand kids feel “shortchanged” or “stiffed” not only can they contest a Will in Probate , they can now contest the Revocable Trust or other revocable structure.
"The LLC Myth"
Does frozen distributions and assets sound like asset protection? It is not! Frozen distributions and assets from temporary or permanent injunctions and enforcement of judgments through the LLC charging order (and every LLC has the charging order provision, some more worse than others) is the risk that you face if your LLC is successfully attacked and has insufficient or no insurance to protect against the particular attack.
Dunkin Donuts knows this which is why they have DD IP HOLDER LLC and Dunkin' Brands Group Inc. NASDAQ symbol (DNKN)
All of the intellectual property, such as the Dunkin Donuts name, logos, etc., are owned by a subsidiary (a holding company) known as DD IP Holder LLC. Take a look at the side of one of their plastic cups.
Operating your personal affairs (and some level of business operations) in private unrecorded trusts has many advantages.
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