Updated: Jan 12, 2021
When people hear about lawsuits and the litigious nature of society, the thought of protecting what one has comes to mind. Many decide to form Trusts merely for asset protection, but it seems as if most do not know that some assets are automatically protected.
Your homestead is protected from forced sale to pay most debts and judgments. Up to ten acres of an urban family home (and improvements) up to 200 acres in rural areas if married (100 acres if single) are protected. It does not matter how much the property is worth. There are exceptions to this rule for mortgage lenders, the IRS, property taxes, and some homeowners associations.
Personal property with an aggregate value of $100,000 for a family and $50,000 for a single person is protected.
Unpaid commissions for personal services not to exceed 25 percent of the aggregate limits.
Other protected assets include your retirement accounts, 529 college savings accounts, life insurance proceeds, and annuities.
For most people, the above exempt assets make up the majority of their estate. Because of that, they have automatic asset protection. This does not mean asset protection is not right for you. This may include protecting yourself in other ways such as forming an LLC for your business, or purchasing an umbrella insurance policy.
Call us at 903-347-3060 for a consultation to discuss your assets and determine what the best fit for asset and liability protection.