Question

Is an asset protection trust fair? Should wealthy people be able to avoid paying their liabilities? What about perpetual trusts that avoid estate taxes forever? If you were a state legislator, how would you vote when this legislation came up for approval? If you had substantial assets would you put them in such a trust? What life principles apply here?

Answer 1

The asset protection Act is a fair one because a grantor can ensure that his assets are managed properly by the trustee and the beneficiaries are getting rewarded by the trust. The asset protection Act makes certain that the assets of the grantor are managed well even after the death of the grantor with proper care. Thus, it is fair to have an asset protection Act in place.

 

Assets are not created to avoid paying off taxes, although, some people get benefited by not needing to pay the taxes. The main objective is to create a secure asset protection environment through which the beneficiaries will get the advantage. In cases, where trusts such as perpetual trusts are concerned, they should be made to pay taxes like any other organization based on the income they receive.

 

The author will vote in favor of the trust because people require some mechanism using which they can secure the assets.

 

If the author has a decent proportion of assets, he will definitely create a trust to offer them a secure cover for them.

 

The life principles which are applied here are such as:

• Creation of a security cover for the assets,

• Asset management after the death of the grantor, and

• Protection of the minor children’s by safeguarding their property.

 

These are the life principles which can be applied to trusts.

These are the life principles which can be applied to trusts.