By The Law Offices of Ronald H. Kauffman of Ronald H. Kauffman, P.A. posted in Equitable Distribution on Wednesday, August 17, 2016.
Nevada has little known laws to attract business in facilitating asset protection, including in divorce cases involving property division.
As the New York Times recently reported:
Over the last decade, for example, New Hampshire has passed nearly a dozen laws affecting trusts that expanded their life span, lowered taxes and made it easier to transfer assets. In 2013, the state created a special trust court subdivision to handle the complex litigation; last year, an overhaul of state banking laws simplified regulations.
Still, Nevada “is definitely the most aggressive. Starting with the absence of any state income tax and resilient secrecy protections, Nevada has added a passel of laws and regulations intended to lure trust business.
Individuals who establish irrevocable trusts have more flexibility to transfer assets to a new trust with more favorable terms. Creditors are blocked from access to money held in trusts.
I’ve written about equitable distribution before. In Florida, all marital assets are subject to equitable distribution. So, even if you leave assets to your children in a revocable trust, they can also be at risk to equitable distribution depending on the circumstances and how they are used.
However, if you create an Irrevocable Pure Grantor Trust (IPUG) and leave assets to your children in their own IPUG, there may be an argument to declare those assets as separate property.
The best way to protect assets in a divorce, of course, is to have a well-written premarital agreement covering the disposition of all of your assets in the event of divorce. Additionally, post-nuptial agreements can also be entered into during the marriage to cover the same ground.
In Florida, assets acquired before the marriage are your separate, non-marital assets. So are noninterspousal gifts, bequests, income from nonmarital assets and assets excluded in written prenuptial and postnuptial agreements.
The most important step to protect your separate assets is to keep them non-marital at all times. As soon as you put your non-marital or inherited money into a joint account with your spouse, that money will very likely be considered a marital asset to be divided in a divorce.
Even if you can show the judge the exact amount in a joint account that came from your inheritance or non-marital assets, the funds are commingled.
The New York Times article is here.