NFT: Lawyers, CPA's .... For a script

seizure

Investments are not unless you move them offshore into a Trust

In comment 13657094 ChicagoMarty said:

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seizure Investments are not unless you move them offshore into a Trust

I think there are onshore possibilities in South Dakota and a few other states.


https://en.wikipedia.org/wiki/Asset_protection_trust - ( New Window )

In comment 13657094 ChicagoMarty said:

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seizure

With all due respect to CM, that's an oversimplification to the point of being bad information. The answer depends on a number of things, including whether you have equity in your home (market value above the mortgage(s)) and what the "homestead exemption" is in your state. Florida, for example, is noted for a very pro-debtor homestead exemption, so if Florida can feature in your plot (a little Carl Hiaasen flavor?), great. The linked article is one of many available discussing this.
your home in bankruptcy - ( New Window )

Depending on your state you can hide assets in annuities and life insurance policies.

not sure if this website still is active.

www.assetprotectionbook.com

I like the Talledega movie reference with regard to with all due respect...

The rebuttable presumption here is that only equity investments are seizable. Why would anyone seize something where there is no equity?

IRS will not seize a house that is a primary residence. Period.

Most Bankruptcy courts will also avoid seizing a primary residence no matter what the regs say. It is more a matter of PR

The IRS you may be right, I don't really do that kind of work.

Bankruptcy trustee, I disagree - I'm not talking about a tapped-out consumer here, I'm talking about people (including fraudsters) protecting their assets via the Florida homestead law, from a bankruptcy trustee who would otherwise use the house to satisfy angry creditors.

Look, Montreal Man is writing the script - we have no idea who the character is. I am just giving him some angles if they're useful.

than anything goes. All the Federal Law Enforcement agencies have seizure/forfeiture authority. They seize the drug dealers house, forfeit it to the government, sell it and place the proceeds into the Asset Forfeiture fund to be shared by Law Enforcement.

Same goes for White collar scamsters

In comment 13657361 ChicagoMarty said:

Quote:

IRS will not seize a house that is a primary residence. Period.

Additional clarification needed here. Will they completely leave your primary residence alone? OR will they put a lien on it so when it eventually sells, they get the proceeds?

which is different from seizure

In comment 13657596 ChicagoMarty said:

Quote:

which is different from seizure

This. Everything is situational. There is no clear cut answer to the ops question really.

He first sells off his assets for an insignificant amount to someone he (thinks) can trust for a nominal amount.
p.s.--I'm no expert on bankruptcy law so there could be protections against such a sale if it occurs too close to the bankruptcy claim (i.e., immediately before). It may be that he had to plan this well in advance, but kept it on the down-low from the potential creditor he fears.

Thanks for the responses. A lot of the plot will depend on the info I get about the legality and process itself. The one point another poster made is while the personal home can't be seized in a bankruptcy situation, can the money made if you sell that house be siezed. Again thanks. ANy more legal verities will be appreciated.

there is a preference period in Bankruptcy - the 9 months before the filing - if you do a transfer or unfairly pay one creditor over another during that 9 month period -- the transfer or payments can be called back by the bankruptcy trustee and divided amongst the creditors.

So any planning to hide assets, whether transferring them into a trust, or to another person, or to an entity not owned by the creditor has to occur outside that nine-month period. If the transfer is deemed to be fraudulent then the trustee can go back further -- that's what happened to all the Madoff money -- the trustee claiming they were all fraudulent transfers - went after anyone that received benefits from Madoff over long look back period that far exceeded the 9 month preference period by years.

Also, the best protection for someone declaring bankruptcy to protect their home is to have it mortgaged to its maximum value. The secured creditor in that instance has a preference in the pecking order of creditors -- and also allows the secured creditor and bankruptcy filer to keep that asset out of the hands of the other creditors.

If I wanted to hide an asset of a home -- I would refi/mortgage it prior to the preference period and place the equity (money) into an irrevocable trust where I was not the ultimate beneficiary, but also where the trustee (and this would be someone I thought would be sympathetic to me and I could trust) could provide for my maintenance and needs during my life. I would include specific language in the trust forbidding any activity of the trust to be in violation of the IRS, and Federal and State bankruptcy rules/laws.