A. asset protection is really a multidisiplinary approach to strategic planning methods including: lawsuit protection, estate planning, privacy protection, tax reduction and financial strategies which maximize investment returns while minimizing risk through diversification and asset allocation. Combining all strategies under one roof, so to speak, really helps clients achieve their objectives without consulting several specialists. When clients visits a CPA for a tax opinion and a Financial advisor for a financial opinion, they sometimes get conflicting information and become throughly confused. Not only that, but they probably get three separate invoices in the mail for their time.
Q. These days we are seeing so many frivolous lawsuits against business owners and ordinary people. What can be done to avoid this?.
A. I generally recommend a multi faceted, tiered approach. Each method being a layer, not unlike peeling an onion; each layer you peel reveals another layer. I actually set up multiple layers of protection, be it domestic entities or perhaps even some international strategies for certain clients. These become hurdles or obsticals for a potential creditor to attempt to penetrate. This puts the negotiation advantage on our client side and avoids leaving him or her vulnerable to creditor seizures and levies.
Q. Could you be more specific as to what you do for clients and who would need this type of protection?
A. I typically use traditional entities but I add customized, unique asset protection attributes. I integrate these entities into a comprehensive strategic plan where each entity serves a special purpose. The basic building blocks includes: Limited Partnerships, Limited Liability Companies, C-Corporations, S-Corporations, Revocable and Irrevocable Trust, Encumbrances, Powers of Appointment and specially drafted contracts and agreements.
Q. You here so much about IRS these days. Are these strategies legal?
A. Yes, All the entities I create have Tax ID Numbers and are set up in compliance with all Federal and State laws. That is why it is so important to have a CPA involved. There are too many people without the requisite tax background trying to do this type of work. It is a shame to see a plan fail due to poor tax planning and advice.
Q. Mr. Sears, you are a published author and have spoken at symposiums throughout the world. How have you achieved this great level of success?
A. Primarily client service. Since 1979 my firm has consistently offered one on one, Personalized assistance in these complex matters. My success is so much attributable to my dedicated staff and their friendly, competent service to clients. My staff includes professionals such as CPAs, MBAs, Enrolled Agents, Financial Advisors and Real Estate specialists.
Q. How can someone contact you to set up their own asset protection plan?
A. I recommend potential clients obtain a copy of my book and perhaps my audio and video. This book can be read in less than an hour, the audio answers many questions and the video tape is a compilation of my best seminars. Also, a potential client should schedule a meeting in the privacy of our office where a preplanning discussion can lead to a personal plan and structure. I always recommend this meeting rather than just setting up entities and then later trying to figure out how to use them. My secretary will gladly schedule a private client meeting at a convenient time.
Q. How does the new tax law impact your planning strategies?
A. Very much so, Dividend and capital gain rates have been reduced to 15% and ordinary income is still taxed at over 35%. Our planning strategies have been uniquely customized to permit the maximum tax reduction under the new law At the same time we continue to use traditional tax savings methods such as pension plans and deferred exchanges to further reduces taxable income. This new law others a limited opportunity to take advantage of these tax breaks. Preplanning is still very important for each client we look for possible restructuring of their legal entities and their asset holding and their liquid asset portfolio.
