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|Asset Protection is all the rage and most so called
experts are nothing more than scammers selling useless or even illegal
products. We debunk the myths and help you separate fact from fiction.
Read the following ten common traps and scams and you will be will armed to avoid the many charlatans peddling ineffective or illegal asset protection products.
FACT OR FICTION?
Fiction 1: YOU NEED TO PUT YOUR MONEY WITH A FOREIGN TRUST COMPANY AND
MOVE IT OFFSHORE
FACT: In most cases protected assets remain in the United States. You should NEVER trust a foreign trustee (or anybody else) with your hard earned money. If somebody suggests that you have to "trust" somebody else with your hard earned savings: RUN.
Fiction 2: WE'LL ENCUMBER YOUR PROPERTY AND THAT WILL PROTECT IT
FACT: If some asset protection expert suggests that you encumber your assets with a phony loan from Aunt Matilda or any related entity you are in the hands of a novice. This is a popular technique which doesn't work (but it will cost you a lot of money and trouble).
Fiction 3: ASSET PROTECTION WILL SAVE YOU TAXES
FACT: Asset protection planning will not save you income taxes. Further, if a practitioner suggests that the IRS can't find or tax an offshore account they are advising you to commit a crime. Stay away from these scammers. All Citizens and Residents of the USA are taxed on their world wide income: PERIOD. Asset protection planning will not change this sad but true fact.
Fiction 4: USE A NEVADA CORPORATION: YOUR CREDITORS WILL NEVER FIND THE HIDDEN MONEY
FACT: Stay away from Nevada corporations. Many of the most heavily promoted scams use Nevada corporations. They argue that bearer shares allow you to control but not own money in a Nevada corporation. HOOEY. This is pure nonsense. Nevada corporations do not work and they are a huge red flag to the taxing authorities.
Fiction 5: JUST HIDE YOUR MONEY AND LIE
FACT: Lying will get your thrown in jail for contempt of court. You protection should never depend on deception. Even if all the details of your asset protection plan are discovered you should not be compromised.
Fiction 6: GIVE IT TO YOUR SPOUSE
FACT: If an expert suggests that you give your assets away (usually to a spouse or child) you are in the hands of a real novice. This normally doesn't work and it is always a bad idea unless you were going to make the gift anyway.
Fiction 7: ONCE MONEY IS OFFSHORE IT IS ONLY TAXED WHEN YOU TAKE THE MONEY BACK INTO THE USA
FACT: If a practitioner suggests that the IRS can't find or tax an offshore account they are recommending that you commit tax fraud. RUN from then as fast as your legs can take you. In this post 911 world the IRS knows everything about every foreign account.
Fiction 8: ALASKAN TRUSTS AND DELAWARE TRUSTS DO THE JOB
FACT: Alaskan trusts and Delaware trusts are untested. Remember, the full faith and credit clause in our constitution. Sister state judgments are enforceable in all other states including Alaska and Delaware.
Fiction 9: PURE TRUSTS AND CONSTITUTIONAL TRUSTS WILL PROTECT YOUR ASSETS (AND ALSO ELIMINATE YOUR DUTY TO PAY TAXES)
FACT: These trusts are fraudulent and have been declared illegal by every single circuit court. The IRS and the INCOME TAX are legal… the Supreme Court says this is so. These trusts don't work and are illegal.
Fiction 10: OFFSHORE BANK ACCOUNTS PROTECT YOUR MONEY WHILE ALLOWING YOU FULL ACCESS TO IT
FACT: Offshore accounts are great and safe if done properly; however, they will not save you any taxes; and, unless connected with an asset protection trust will not protect your money. Remember, a US Judge, has jurisdiction over your BODY. It this Judge orders you to write a check to some creditor and you refuse then you are going to jail for contempt of court. Simple as that: pay up or give up your freedom.