Rss Feed
Tweeter button
Facebook button
Technorati button
Reddit button
Myspace button
Linkedin button
Webonews button
Delicious button
Digg button
Flickr button
Stumbleupon button
Newsvine button
Youtube button

Asset Protection Attorney Ike Devji Featured In Wall St. Journal

Asset Protection Attorney Ike Devji

Asset Protection Attorney Ike Devji

Phoenix, Arizona.

Asset Protection attorney Ike Devji was recently featured in a Wall Street Journal story about Offshore Asset Protection Trusts by Norb Vonnegut.

“It was pleasure to be part of Norb’s story, especially since he took the time to ask the right questions and do his homework, most reporters focus only on the sensational aspects of international or offshore planning. The fact is, the number of people who do it safely and legally every day outnumber those who do not, or who have been unfortunate enough to work with crooked non-lawyer promoters or bad lawyers by well over 1000 to 1.”

Devji has over a decade of experience devoted exclusively to being a “legal bodyguard” for billions of dollars worth of the wealth and assets of successful Americans and their families across the United Sates. He is a frequent speaker, author and educator, teaching CLE to other attorneys and financial advisors and CME (Continuing Medical Education) to doctors all over the United States and has authored hundreds of articles related to his actual daily legal practice with clients across the U.S.

Devji is quick to point out that there are many myths in the area of asset protection and that a tool is not a good tool for you unless it is a fit for your specific assets and fact pattern. He also believes that the best Asset Protection and Wealth Preservation planning is always a system of layers that includes a professional liability insurance program (not just one policy), risk management and legal tools.

You can read more about Ike Devji, Asset Protection and Wealth Preservation concepts and other related issues at www.ProAssetProtection.com

LINK: WSJ.com – Warding off predators with offshore trusts

 

Asset Protection Trusts For Doctors – An Introduction

law and money for doctorsAsset-protection strategies for physicians take many forms and range from sound policies and procedures that seek to minimize risk and liability to crisis-management plans, the right kinds insurance, and, finally, specific legal tools.

All of these strategies can be valid and effective parts of a true asset protection and risk management system and the key to the success of most plans is having many effective layers instead of seeking a single solution cure.

 

In previous discussions we’ve addressed the use of specific tools like limited partnerships and captive insurance companies by doctors, to name just two specific examples of tools that can be effective when used and drafted the right way. This week examine the Asset Protection Trust (APT) and address some of the most basic questions and misconceptions we’ve helped thousands of physicians investigate on a consistent basis.

When can I do it?

As with any asset-protection strategy, the key element is timing. This is preventative or defensive medicine but terribly ineffective against a pending or existing exposure. Implementing this against something that has already happened is called “fraud”.

What is it?

The Asset Protection Trust or APT is typically an irrevocable trust that becomes the owner of the assets being put into it, typically referred to as “gifting” or “funding.”

Why is it irrevocable?

In order for the property to truly be outside the reach of a judgment creditor by law it must go into a vehicle that is granted permanent, irrevocable title. If you, the “grantor” can easily pull it back at will, it is generally not protected from others either. It must truly be the property of the trust.

Is it the same as my estate-planning trust?

Typically no, but some estate planning vehicles do provide asset protection. The estate planning trust most doctors have or have seen is generally referred to as a Revocable Living Trust, a.k.a. “family trust” or RLT. This structure is often correctly funded with your home, investment account, and other assets. This is so those assets follow a specific chain of custody at your death and avoid the probate process. Unfortunately because this vehicle is revocable by you at will it offers ZERO creditor protection during your lifetime. A simple way to keep this straight is this: Estate planning is death planning and concentrates of giving your property away as you desire at your death. Asset protection on the other hand is life planning and preserves the assets you have, use, and would like to pass on so that they actually get to the estate plan.

I paid a great deal for my trust, does that mean it does more?

Usually not. Fees can vary widely based on the local legal market and the skill and experience of the drafter and what their expertise demands. Unfortunately, paying more does not it automatically make it better or give it extra features.

Can any lawyer do it?

Like any area of the law asset protection is an increasingly complex and specialized practice and as such it should be ventured into with an attorney with some very specific experience, just as you’d select a divorce, tax, bankruptcy, or other focused practitioner. While it shares similarities with other areas of law including corporate law and estate planning, there are a variety of considerations that must be accounted for with every move including timing, the liquidity needs of the doctor, the most defensible choice of legal entity, the jurisdiction that controls and legitimate business purpose. As asset protection has grown increasingly popular with consumers the number of attorneys and non-attorney promoters that have entered the field has grown exponentially. Furthermore, the leading sellers of form legal documents have recently increased their marketing of documents structured for the this purpose. In some cases, those documents are adequate; in others they are hopelessly inappropriate or drafted with fatal errors. Either way, even assuming the form is perfect, the application must be learned and apply to your very specific asset structure and fact pattern. Buying the best laser in the world will not make me a surgeon.

This simple introduction just scratches the surface of the features and issues physicians should understand when considering an APT. We will continue the conversation over the next few weeks and cover issues like jurisdiction, selecting counsel and the appropriate use of the tool as part of a system. As always, this information is general in nature and never fact specific legal advice. This article originally appeared at www.PhysiciansPractice.com, where Attorney Ike Devji is a regular contributor.

 SEE THESE LINKS FOR MORE DETAILS:

U.S. Citizen Thinking Of Expatriating? Important Articles on What it Means

Due to the nature of our practice with thousands of Americans we have safely helped use a variety of tools including offshore trusts in a safe and legal way, we get lots of questions about expatriation.

Our position remains the same;  the best of usage of these tools is tax neutral and provides surety while allowing you to maintain your life and family inside the U.S. Below are some recent articles that address issues faced by those seeking to flee taxation by abandoning their U.S. citizenship forever.  – Ike Devji

 

FORBES: TEN FACTS ABOUT TAX EXPATRIATION:

http://www.forbes.com/2010/03/23/expatriation-exit-tax-limbaugh-obamacare-personal-finance-robert-wood.html

 

SCHUMER, CASEY ANNOUNCE PLAN TO STOP FACEBOOK CO-FOUNDER FROM DODGING TAXES BY DROPPING U.S. CITIZENSHIP

http://www.schumer.senate.gov/Newsroom/record.cfm?id=336808

Expats Face Steep Exit Tax Courtesy of Facebook

http://www.forbes.com/sites/robertwood/2012/05/18/expats-face-steep-exit-tax-courtesy-of-facebook/

Facebook Co-Founder Saverin Gives Up U.S. Citizenship Before IPO

http://www.bloomberg.com/news/2012-05-11/facebook-co-founder-saverin-gives-up-u-s-citizenship-before-ipo.html?goback=%2Egmr_3694878%2Egde_3694878_member_115647457

THIS IS A LINK TO SOME OF MY PREVIOUS ARTICLES ON OFFSHORE ISSUES INCLUDING THE RIGHT USE OF THE OFFSHORE TRUST AS A POWEREFUL TOOL IN  LEGAL and TAX NEUTRAL WAY: http://www.proassetprotection.com/category/offshore/

Tax Planing Schemes Every Physician (and Business Owner) Should Avoid

The next 60 days marks the final push to sell physicians and private business owners across the United States tax plans of both good and questionable value. Promoters of various plans are well aware of the pressures affecting your income and will make a variety of frivolous arguments that appeal to your desire to save. As always a great CPA is your first line of defense against both tax exposure itself and the risk of committing tax fraud through an overreaching plan, but there are a number of common markers that are easy to spot. 

The IRS creates an annual list of the “Dirty Dozen” tax schemes; here’s a breakdown of the top ones that affect or target doctors and business owners.

 

Remember that the higher your income, the more likely you are to face an audit and substantial civil and criminal penalties that I guarantee will exceed any short-term savings gleaned from any bad planning. This simply means that you and your team must be committed to strictly adhering to the tax code, full and accurate reporting, and being realistic about how you pay yourself and the amount of income you declare. In most cases, it is not “commercially reasonable” to pay yourself less than six figures when the average salary for specialists like you in your state is much higher but we see doctors and CPAs abuse this discretion on a regular basis.

Hiding income offshore
I use offshore tools for a variety of my clients business and asset protection purposes regularly; tax planning is not one of them.

Taxpayers have tried to avoid or evade U.S. income tax by hiding income in offshore banks, brokerage accounts, or through the use of nominee entities. Taxpayers also evade taxes by using offshore debit cards, credit cards, wire transfers, foreign trusts, employee-leasing schemes, private annuities, or insurance plans. (via the IRS)

You have a well-defined legal right to have an offshore account and in our global economy even manage certain business and investment activities offshore but that income is taxable and even the mere existence of an account has a reporting requirement. Simple rule, full disclosure, and compliance mean never having to say, “I’m sorry.”

Frivolous arguments
These schemes are increasingly sophisticated in their arguments and packaging and often even include either false or off-point private letter rulings on the legality of a specific plan or letters of opinion from a “top tax law firm.” The IRS has a very specific guide to understanding those arguments.

Abusive retirement plans
The IRS continues to find abuses in retirement plan arrangements, including Roth Individual Retirement Arrangements (IRAs). The IRS is looking for transactions that taxpayers use to avoid the limits on contributions to IRAs, as well as transactions that are not properly reported as early distributions. Taxpayers should be wary of advisers who encourage them to shift appreciated assets at less than fair market value into IRAs or companies owned by their IRAs to circumvent annual contribution limits. Other variations have included the use of limited liability companies to engage in activity that is considered prohibited, a common exposure in self-directed IRAs without professional guidance.

Disguised corporate ownership
Corporations and other legal entities are formed and operated in certain states for the purpose of disguising the ownership of the business or financial activity by means such as improperly using a third party to request an employer identification number. Such entities can also be used to facilitate underreporting of income, fictitious deductions, non-filing of tax returns, participating in listed transactions, money laundering, financial crimes, and even terrorist financing. The IRS is working with state authorities to identify these entities and to bring the owners of these entities into compliance with the law.

While the actual list is much longer, some of the issues like identity theft exposure are applicable to the public at large. Others, including filing false or incomplete W-2s, claiming excessive fuel tax credits, and over-reporting withholding to reduce income are simply intentional tax fraud that we will assume you are not ever going to consider. Make sure you understand the nature of the methods used on your return, you are responsible for what’s on it regardless of who prepared it, and keep tight records on deductions for travel and dining.

Finally, carefully discuss the value of claiming excessive business usage for vehicles and a home office deduction with your CPA; they are common over-reaching red flags and typically of limited value.

As always, the information presented here is general and educational and can never replace the advice of experienced counsel specific to your assets or situation. This article originally appeared at www.PhysiciansPractice.Com where Ike Devji is a regular contributor, and is reprinted here with permission.

A Doctor’s Guide to Navigating Offshore Waters Safely – Asset Protection

A Doctor’s Guide to Navigating Offshore Waters Safely

By Ike Devji, J.D. | April 19, 2011

In the world of physicians’ legal and financial planning there is no term as simultaneously oversold, feared, and misunderstood as “offshore.” This is especially true at tax time, as all doctors and their practice managers have been bombarded by the promoters of various tax savings schemes that range in skill from “genius” to “criminal.” The legal jeopardy of using these tools the wrong way has been well illustrated by the recent crackdown on U.S. taxpayers including thousands of doctors who have been caught up and exposed by in the recent UBS scandal, as just one notable example among many.

As someone who has used these tools with doctors on a weekly basis for nearly a decade, I have seen a variety of approaches implemented with varying degrees of success. The following are core issues you must understand to use these powerful tools effectively and legally.

TAXES — All U.S. taxpayers have a duty to report any and all offshore accounts. The U.S. operates on a system of worldwide taxation, and while in certain limited cases money actually earned offshore may be tax exempt (see your CPA) it almost always carries a corresponding duty to report the income. If your primary motivation is to move money offshore and grow it free of taxes or at a lower tax rate, you are looking at the wrong strategy and creating a liability.

SECRECY — Secrecy is never part of any competently drafted offshore plan. Further, secrecy relies on the hope that you can open a “secret account” and no one will know about it and be able to reach it. It also relies on your willingness to lie about the existence of the account if you are ever asked about it in court or discovery proceedings, also known as perjury, which itself has substantial legal penalties.

TITLE — Who holds title to any offshore bank accounts is also crucial in effective use of the tool. If you hold title personally, including through a family member, or through a revocable trust in any form, assume the funds are accessible to a hostile party almost as easily as if they were located here in the U.S. From an asset protection perspective, using an irrevocable trust with an offshore third party trustee that is immune to U.S. court proceedings and a bank experienced in such matters in a protective jurisdiction is crucial.

THE BANK— Any serious offshore planning involves the use of a bank to be the custodian of funds. I advise that those seeking the protection these plans require use reputable first-world, (typically European) state-owned, and insured banks. New banking jurisdictions are emerging and there are reputable banks in most of the developed world, but few of them have experience in dealing with the issues you are likely concerned about. Further, international banks that have U.S. offices are not considered protective in any way; an experienced lawyer would simply move on the assets through a domestic branch. As an example, not only did the physicians that moved money to illegal unreported accounts through UBS commit tax fraud, they didn’t protect the money in any real way.

JURSIDICTION — Another vital issue is the jurisdiction of the account and the entities you are relying on to mange and protect it. Some offshore jurisdictions have laws and decades of history and infrastructure that specifically support the use of offshore trusts and accounts for legitimate purposes. A whole new group of jurisdictions would like to play in this arena and are aggressively promoting their laws, banks, and trust companies. While only time can sort out which of these jurisdictions are truly safe and politically and economically stable enough to trust with your life savings, I can tell you that few of us that practice primarily in this area would ever let our clients be a part of this “test.”

If you are considering offshore planning, keep these issues in mind and make sure the organization you are working with is staffed by experienced legal and accounting professionals with the resources necessary to do more than sell you a bank account and the proven infrastructure to help you achieve legitimate goals.

This article originally appeared at www.PhysiciansPractice.com the nation’s leading practice management resource, where Ike Devji is regular contributor. It is reprinted here with permission.

Tougher Tax Law For Overseas Assets

Tougher Tax Law For Overseas Assets
(Dow Jones) A new U.S. law that is part of a crackdown on tax havens means that wealthy clients will be hit with stricter filing requirements next tax season.

New rules will result in duplicate reporting for some taxpayers and steep penalties for those who fail to comply. The law makes it more difficult to hide assets overseas, partly by taxing foreign banks that don’t share information about U.S. account holders.

READ MORE:

Tougher Tax Law For Overseas Assets

UNREPORTED FOREGIN BANK ACCOUNTS – DEADLINES AND PENALTIES LOOMING

People who haven’t reported ownership of foreign accounts by September 23 may face jail time and fines.

By Seth J. Entin

Mr. and Mrs. Doe, who are U.S. citizens, have an account with a foreign financial institution. The Does have never reported their ownership of or the income from this account on Schedule B of their U.S. federal income tax returns, and they have never filed Treasury Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts or FBAR), which they are required to do to disclose this account.

SEE THE WHOLE STORY HERE: http://www.fa-mag.com/online-extras/4478-wednesday-deadline-approaching-for-foreign-accounts.html