Turtle Creek Financial Group is involved retirement planning, estate planning and
wealth management for business owners and other affluent individuals through
out the state. We are licensed for a variety of Registered Investments; limited
Partnerships, Mutual Funds, Individual Stocks as well as highly sophisticated
Insured Vehicles.
In the late 90's with the rise of lawsuits and awards for liability cases, there
began a heightened concern for asset protection planning. Most people heard the
radio commercials for Asset Protection Specialist as well as the T.V. commercials
for Trial Lawyers ranging from "Have you been injured by your Doctor, your
employer, your vehicle, your Medication?to 800-BADDOGS". Because we work
with people who either have wealth or are amassing it, the increase in law suits
is obviously of concern to us.
We have researched various avenues for asset protection. We work closely with many
accountants and attorney's and have access to resources both inside and outside
our particular area of experience. We investigated Corporate Umbrella's, Limited
Liability Partnerships, Qualified Pension Plans, 419 Trusts, Revocable and Irrevocable
Trusts. All of these strategies involve substantial management and legal fees,
often in the thousands of dollars.
We have determined that several of these strategies can provide some limited protection
from law suit, but that most are subject to challenge, which means litigation,
which means time and money. Of all these strategies, the irrevocable trusts seem
to offer the most asset protection, however, the trust arrangement require the
Grantor donate assets and give up control. Should the Grantor have a mechanism
to retrieve the assets, the protection is lost when the assets come back into
the Grantors control.
One class of asset enjoys unlimited exemption from creditor claims on both the principal
and proceeds. This exemption is provided by Texas State Law in the Property Code
Section 42001 & Texas Insurance Code Section 21.22 which specifically classifies
individually owned contracts of life insurance and annuities and their proceeds
as Type II Unlimited Exempt Assets. Unlimited exemption is provided to Oklahoma
residents under Oklahoma State Title 36 Section 3631.1(A).
No trust, or other umbrella enjoys the unlimited, unchallengable status of life insurance
contracts, which are also not public record and not subject to disclosure. The
tax advantages, in addition to the creditor protection offset mortality expenses,
particularly in light of the fact this approach does not require trust work and
up-front ,as well as ongoing legal and accounting fees.
Exemptions vary by state. Texas & Oklahoma - 100% exemption of account values
and proceeds.
Copyright 2005 Turtle Creek Financial Group. All right reserved.