Skip to content
Call Now To Schedule An Asset Protection Analysis: (800) 231-7112

Many classes of assets are considered exempt assets.  Exempt assets are simply those assets that a creditor cannot to “look to” in satisfaction of a judgment.  For example, if Tom wins a lawsuit against Jerry, Tom is now a judgment creditor and Jerry is a debtor.  In other words, Jerry owes Tom money.  In an effort to collect the money he is owed, the courts can permit Tom to seize certain property owned by Jerry and sell it to settle the debt–to satisfy the judgment against Jerry.  Jerry should definitely have consulted an asset protection lawyer.

What Tom Can’t Get

Some assets have built in asset protection features.  That simply means that some are beyond the reach of judgment creditors.  Build in asset protection features are provided by state law, so the protection afforded from state to state varies drastically.

Consider the case of a California resident moving to New York.  Let’s call this pretend person Rita.  Assume that Rita has an annuity that she created in California before moving.  California asset protection laws provide that unmatured annuities are exempt from the claims of debtors to the extent of $9,700 of their loan value.  Matured annuities are exempt to the extent reasonably necessary to support a family.

New York asset protection laws, on the other hand, define annuities as spendthrift trusts.  The effect of that definition is that judgment creditors cannot touch any part of an annuity contract.  Clearly, New York provides better asset protection for annuity contracts.  So Rita is lucky that she’s moving, right?

Exporting Automatic Asset Protection Rules

Automatic asset protection rules cannot be transported!  In Rita’s case, if she loses a lawsuit in New York, the judgment creditor will be able to come after her annuity.  Even though Rita lives in New York, her annuity was created in California and it is governed by California law.  Even though in this case that fact works against Rita, the moral of the story is that automatic asset protection laws cannot be exported to other jurisdictions.

In simple terms, this means that moving to a state with very good automatic asset protection rules does nothing to protect you, assuming that your accounts (e.g. IRAs, annuities, life insurance policies, etc.) were created and exist under the laws of another state.  People make very bad assumptions about the effect of moving to a new state all the time, and it ends up costing them.  Don’t be one of those people.  Contact Lodmell & Lodmell today to see how we can serve your needs.

This Post Has One Comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Pashmina Lalchandani

CEO & Co-Founder, Bar & Cocoa / Owner, Flow Simple
December 9, 2010, Douglass was a client of Pashmina’s

I’ve known Doug in many contexts, as a friend, as a client and as a business partner and he impresses me on all levels. He’s dependable, smart, generous and I wouldn’t hesitate recommending him and his law firm to anyone.
He’s the best and most ethical lawyers providing asset protection with rock solid strategies to give you peace of mind about your wealth. Straight forward, and straight talk. Doug is exactly the lawyer I want on my side. If I send someone to Doug, I know they’ll thank me for it!

Social & Solar Entrepreneur, Pan Afrikan Theorist, Translator/Interpreter,
Founder & Visionary Leader @ Afrikanpride.
March 12, 2011, Marlon E. D. J. worked with Douglass but at different companies

Doug is one of the most powerful thinker i have came across. During the short time that i have known Doug he has been a great source of inspiration. He has a simplistic yet effective and accurate way to analyze anything you bring to his attention, and then by asking you key questions he gets you to see the light at the end of the tunnel. Besides being extremely bright, he is a genuine and caring individual which is why I feel fortunate to know him. I can say without a doubt that he his the person you would want to talk to if you were in need of a person with his expertise.
Most of the lawyers out there will probably meet your needs, but if you are looking for someone to exceed your expectations and give you that wow factor, look no more he is the person for the job.

Patricia Salter

Associate Dentist at Smileology
December 1, 2010, Patricia was a client of Douglass’

I have been a client of Douglas Lodmell’s since 2001. My main concern was asset protection in this litigious society. I can sleep alot better at night knowing I have the instruments in place to protect the fruits of my labor, and that they will not end up in the hands of a slick trial attorney.

Corporate Transparency Act

Stay compliant with the Corporate Transparency Act.
Report your business entities easily through FinCEN’s streamlined process.

Contact Us Today to Schedule an Asset Protection Analysis.

800-231-7112

Back To Top