investments protected from medical or legal liabilities

[BigBiceps]

What types of investments are there that are protected against medical or legal judgements/claims?

Ie. you go to the doctor and have a 6 million dollar procedure and your health coverage is capped at 5 million. What types of investments are going to be exempt from a medical claim?

Ie. you hit someone with your car and kill them and there is a 3 million dollar judgement against you. Your car insurance and umbrella coverage only cover 1.5 million. What types of investments are going to be exempt from a legal judgement?

I have heard about property in some states has homestead exemptions, but in California it is some low amount like 50-100k.

Thanks in advance.

[slush fund]

[ QUOTE ]
What types of investments are there that are protected against medical or legal judgements/claims?

Ie. you go to the doctor and have a 6 million dollar procedure and your health coverage is capped at 5 million. What types of investments are going to be exempt from a medical claim?

Ie. you hit someone with your car and kill them and there is a 3 million dollar judgement against you. Your car insurance and umbrella coverage only cover 1.5 million. What types of investments are going to be exempt from a legal judgement?

I have heard about property in some states has homestead exemptions, but in California it is some low amount like 50-100k.

Thanks in advance.

[/ QUOTE ]

the short answer is almost none. i collect on judgments for a living and the general rule is if you have something to lose, it can be taken.

here are the exceptions: a small number of states have a full homestead exemption, Florida where i am being one, but for only your primary residence. yeah, that's why OJ lives here. so that means no rental properties at all. while a homestead exemption will prevent any attempts at foreclosure, the judgment becomes a lien against the property that in most cases has to be satisfied if you want to sell or refinance or otherwise pass title.

other than that, bank accounts, brokerage accounts, corporate shares in companies you personally own are all accessible for seizure. one difference between owning a corporation and an LLC, is that a creditor can seize your corporate shares if you own a corp., but can only get what is called a charging lien against an LLC. a charging lien entitles the creditor to any future cash disbursements but you retain ownership of the LLC.

alright here is the secret to full and complete asset protection from creditors, get married. after you get married place every asset and account in you and your wife's name together. if a judgment is ever obtained against you, none of the jointly owned assets can be accessed unless the judgment is against both you and your wife together. so if you are married, never get joint credit cards or apply for credit jointly or buy an car in both of your names, always do it individually. this doesnt apply to corps of LLCs tho because they can't be owned jointly as a "tenancy by the entireties" that other assets are in a marriage

[dixion]

Slush Fund

Does that mean if your spouse is getting sued, say for wrongful termination, that the other can open an account in his/her name and move all assets into that account and have them protected? Also, say your spouse loses, can both of your wages be garnished or just the spouse named on the suit? Thank You.

[DesertCat]

[ QUOTE ]

the short answer is almost none. i collect on judgments for a living and the general rule is if you have something to lose, it can be taken.

here are the exceptions: a small number of states have a full homestead exemption, Florida where i am being one, but for only your primary residence. yeah, that's why OJ lives here. so that means no rental properties at all. while a homestead exemption will prevent any attempts at foreclosure, the judgment becomes a lien against the property that in most cases has to be satisfied if you want to sell or refinance or otherwise pass title.

other than that, bank accounts, brokerage accounts, corporate shares in companies you personally own are all accessible for seizure. one difference between owning a corporation and an LLC, is that a creditor can seize your corporate shares if you own a corp., but can only get what is called a charging lien against an LLC. a charging lien entitles the creditor to any future cash disbursements but you retain ownership of the LLC.

alright here is the secret to full and complete asset protection from creditors, get married. after you get married place every asset and account in you and your wife's name together. if a judgment is ever obtained against you, none of the jointly owned assets can be accessed unless the judgment is against both you and your wife together. so if you are married, never get joint credit cards or apply for credit jointly or buy an car in both of your names, always do it individually. this doesnt apply to corps of LLCs tho because they can't be owned jointly as a "tenancy by the entireties" that other assets are in a marriage

[/ QUOTE ]

What about IRAs and pensions? I always heard those were protected against judgments. An example is OJ Simpson, who still lives off a pretty sweet NFL pension even with a $20M judgement hanging over his head.

My cash brokerage account is in the name of an LLC owned by my wife and I. How safe is that?

[Todd Terry]

Anyone with enough $ to worry about this type of thing should discuss these issues with an attorney. Every state is different. And specific intent to frustrate the collection of a judgment is always grounds to set aside a conveyance, so talking about it on a public forum is a bad idea.

I'm fairly sure asset hiding is part of the core curriculum in medical school, so if you know a doctor, ask him/her for a recommendation of an attorney.

[DesertCat]

[ QUOTE ]
Anyone with enough $ to worry about this type of thing should discuss these issues with an attorney. Every state is different. And specific intent to frustrate the collection of a judgment is always grounds to set aside a conveyance, so talking about it on a public forum is a bad idea.

[/ QUOTE ]

My lawyer specifically sold me an LLC because he said it would protect me. Whom am I to believe now? An internet anonymite, or a lawyer who wanted to sell me something?

And no, I'm not trying to frustrate any existing judgements, just protect assets in the unlikely event any occur.

[Jimbo]

I am no attorney but have had several different corporations and am sure that if determined by a court of law that the primary reason the corp was setup was to hide assets from personal debt they will "pierce the corporate veil", as it is coined, and lose the protection.

Jimbo

[slush fund]

[ QUOTE ]
[ QUOTE ]

the short answer is almost none. i collect on judgments for a living and the general rule is if you have something to lose, it can be taken.

here are the exceptions: a small number of states have a full homestead exemption, Florida where i am being one, but for only your primary residence. yeah, that's why OJ lives here. so that means no rental properties at all. while a homestead exemption will prevent any attempts at foreclosure, the judgment becomes a lien against the property that in most cases has to be satisfied if you want to sell or refinance or otherwise pass title.

other than that, bank accounts, brokerage accounts, corporate shares in companies you personally own are all accessible for seizure. one difference between owning a corporation and an LLC, is that a creditor can seize your corporate shares if you own a corp., but can only get what is called a charging lien against an LLC. a charging lien entitles the creditor to any future cash disbursements but you retain ownership of the LLC.

alright here is the secret to full and complete asset protection from creditors, get married. after you get married place every asset and account in you and your wife's name together. if a judgment is ever obtained against you, none of the jointly owned assets can be accessed unless the judgment is against both you and your wife together. so if you are married, never get joint credit cards or apply for credit jointly or buy an car in both of your names, always do it individually. this doesnt apply to corps of LLCs tho because they can't be owned jointly as a "tenancy by the entireties" that other assets are in a marriage

[/ QUOTE ]

What about IRAs and pensions? I always heard those were protected against judgments. An example is OJ Simpson, who still lives off a pretty sweet NFL pension even with a $20M judgement hanging over his head.

My cash brokerage account is in the name of an LLC owned by my wife and I. How safe is that?

[/ QUOTE ]

yes, IRA's, pensions and annuities are protected in my state and yes as a previous poster said, collecting judgments will be different from state to state. i am a collections lawyer but i only practice in florida and my answer was kind of general but i was trying to answer OP's question as to the investments that i am looking to go after, real property, bank accounts, brokerage accounts, and interests in businesses.

as for your brokerage account, i have never encountered that situation before but if i were to answer your question if it safe from an judgment against you, i would say your money is safer if you just had the account as a tenancy by the entireties account jointly with your wife. this is just in florida but if i had a judgment against you, while i could not seize the cash in the account, i could put a charging lien against your interest in the LLC that would entitle me to your half interest of any cash disbursements from the LLC made to you and your wife. like i said, this is how it is in my state but i do belong to a national email listserve of collection attorneys and if you want i will ask an attorney from your state if its similar there when i am in the office on monday

[slush fund]

[ QUOTE ]
Slush Fund

Does that mean if your spouse is getting sued, say for wrongful termination, that the other can open an account in his/her name and move all assets into that account and have them protected? Also, say your spouse loses, can both of your wages be garnished or just the spouse named on the suit? Thank You.

[/ QUOTE ]

i assume your spouse is being sued personally and not as the owner of a corporation or LLC but in any case fraudulent conveyances to avoid paying creditors will ultimately not protect the asset. In my state, in order to seize personal property owned by a married couple jointly, the judgment must be against both of them and not either one individually.

wage garnishment is definitely a state to state thing. a small few outlaw it completely (Texas, Pennsylvania). in Florida there is a head of household exemption which states that if you provide more than one half of the support of a dependent, your wages are exempt from garnishment. the caselaw has expanded to include almost anyone as a dependent, grandchildren, parents, and the other spouse in addition to being extremely liberally granted by courts. so here its basically the person who makes the most money in the house is exempt from wage garnishment which would make it impossible to garnish the wages of both people in a marriage, even if you had a judgment against both of them. to answer your question though as a general rule, a spouse's wages could never be garnished to pay a judgment that is only against the other spouse. any other differences that would apply in the state you live it you could probably find very easily on teh internets