spendthrift trust a non-grantor, irrevocable, complex ... 4th trust and tax meeting.pdf · form of...
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SPENDTHRIFT TRUSTSA NON-GRANTOR,
IRREVOCABLE,COMPLEX, DISCRETIONARY,
SPENDTHRIFT TRUST
KEY TRUST INFORMATION
Trust Operation• You may never remove assets from or transfer assets to the Settlor of
the Trust after the Creation of the Trust.
•
• All income or losses generated by the Trust should be reported with a Federal Income Tax Return.
•
• Trustees of the Trust must sign as a “Trustee” when acting on behalf of the Trust.
Cautions
• Never write on or alter the Trust Documents.
• Never change, revoke, or destroy any Trust Documents.
• Never return, transfer the ownership of Trust Property to the Settlor of the Trust or anyone making an endowment to the Trust.
• Compliance
• The Trustees of the Trust are required to always be in Compliance with the Powers of the Trustees as stated in the Trust and the Terms and Conditions of the Trust. The Trustee has a binding Fiduciary Responsibility by law.
THINGS THAT TRUST CANNOT BE USED FOR
• Reduction or elimination of income subject to tax.
• Deductions for personal expenses paid by the trust.
• Depreciation deductions of an owner's personal expenses paid by the trust.
• Depreciation deductions of an owner's personal residence and furnishings.
• A stepped-up basis for property transferred to the trust.
• The reduction or elimination of self-employment taxes.
• The reduction or elimination of gift and estate taxes.
• Any illegal activity whatsoever.
• Fraudulent conveyance of assets to avoid judgments or government seizure.
• Any operation contrary to state, local or federal law.
SPENDTHRIFT TRUST
LEGAL OPINION
THE TRUST DOCUMENTS WERE COPYRIGHTED,BEGINNING IN 1999 AND COMPLETED IN THE YEAR2000. ADDITIONAL DOCUMENTS HAVE BEENCOPYRIGHTED IN 2012 MAKING THE TRUST IN FULLCOMPLIANCE WITH THE INTERNAL REVENUE CODE.THE COPYRIGHTS ARE EXCLUSIVELY SOLD THROUGHMASTERS COPYRIGHTS LLC IN HOUSTON, TEXAS. ONREQUEST, MASTERS COPYRIGHTS LLC CAN ASSIST INARRANGING LEGAL SERVICES, TAX PREPARATION,AND LEGAL CONSULTATIONS AND ESTATE PLANS.
Masters Copyrights LLC
INFORMED OR UNINFORMED
Estate planning specialists stress that there are twotypes of taxpayers: informed and uninformed. Theless informed you are, the more taxes you pay as ageneral rule. The uninformed are vulnerable to claimsof liability and the informed are protected and oftenimmune to claims of liability against effectingproperty and assets. Spendthrift Trusts can reduce theburden of taxes, deter claims and limit liability.
INVESTMENT AND CONFIDENTIALITYNOT SUBJECT TO PROBATE
• Trustees have unique powers allowed by law with a properlycreated trust allowing investments in real or personalproperty of any nature.
• Probate requirements for wills often result in making a publicrecord of the terms and distribution requirements of the will.Trusts are not subject to Probate. Trusts however are notfiled and are not on any public register. Legal Trusts areregistered with the IRS through an EIN number. While thelegal trust must file a 1041 tax return each year, it remainsconfidential as it is not public record.
PROPERTY PROTECTION AND TAX ADVANTAGE
Why, then, choose to make your trust irrevocable? Theanswer is simple: tax advantages and legal protection fromall liability. Irrevocable trusts do not pay taxes oncapitalization and endowment and are generally beyondthe reach of creditors and judgments with limited exceptions.Conversely, revocable trusts offer no tax benefits at all andmay be reached by creditors to satisfy judgments. If youwant lots of flexibility, poor tax consequences and no legalprotection, make your trust revocable. But if you want goodtax consequences and legal protection, you must foregoflexibility and form an irrevocable trust instead.
TOTAL PROTECTION
Property held by a properly structured contract in the form of a Spendthrift Trust Organization is generally protected from tax liens, levies, and seizures, lawsuits, divorce claims and bankruptcy. The Spendthrift Trust Organization is not liable for the debts of the trustees or the beneficiaries and the assets held by the trust generally cannot be seized to satisfy their debts*. Further, the trustees and beneficiaries are not liable for the debts of the Trust Organization.
All the states have enacted legislation
generally confirming that the interest of a
beneficiary under a trust is not subject to
execution or attachment by his creditors.
There are also many decisions of state court
supporting this concept. We have not found
any to the contrary.
STATE ACTIONS ENHANCING
FUNDAMENTAL TRUST LAW
MAIN ADVANTAGES OF THE SPENDTHRIFT TRUST
Every aspect of it is lawful. It is guaranteed by the U.S. Constitution, Supreme Court and other court decisions.
●It is easy to establish, can be maintained by you and involves minimal paperwork. It greatly reduces or eliminates fees.
●It is lawful in every state. A Spendthrift Trust properly established in one state can operate in any other state.
●It is made irrevocable to avoid any questions as to ownership of the assets.
●It prevents any information about your assets, liabilities and heirs from becoming public.
●It can be used to control tax liability.
●It can operate any lawful business anywhere in the world. It has limited liability and most of the advantages of a corporation with none of the disadvantages.
●It has no periodic reports or accounting to make to any state or government.
• It has the same constitutional rights as any
individual, that is, the right to privacy, freedom
from unwarranted search and seizure, to refrain
from self-incrimination and all other rights.
• All of the assets and cash that are moved into a
trust, through the endowment of the corpus, is
totally tax deferred.
• When the Spendthrift Trust is used in a legal
manner and under the provisions of the
Spendthrift, it is totally impenetrable by creditors,
agencies, governments and is immune from
transfer by operation of law.
• Your personal bankruptcy has no effect on the
Spendthrift Trust assets.
WHO CAN BENEFIT FROM A SPENDTHRIFT TRUST?
EVERYONE!!!
PROFESSIONALS - DOCTORS, DENTISTS, CHIROPRACTORS, ENGINEERS, ETC. Reduce or eliminate the need for liability insurance Render yourself virtually judgment-proof Control your taxes Maintain privacy
RETIRED PERSONS. Reduce income taxes Maintain privacy
INVESTORS, Protect your investments from a financial reversal
FOREIGNERS, Maintain privacy while enjoying the benefits of controlling Real Estate in the United States
The Goal of Masters Copyrights
LLC is to protect the assets of
clients and reduce taxation.
Masters Copyrights LLC and the
Rosen & Rosen Law Firm are
happy to serve you with your
needs.
Thank you again for coming!
Thank You for Attending this Presentation.