Asset Protection Trust Handbook For Advisors: Design, Implementation and Administration Formalities for Advisors

The "Asset Protection Trust Handbook for Advisors" by Martin M. Shenkman, Alan S. Gassman, and Jonathan Blattmachr is a detailed guide for estate planners, lawyers, accountants, and financial advisors, focusing on the design, implementation, and administration of Asset Protection Trusts (APTs). The handbook begins with a preface that emphasizes the necessity of cautious and well-informed asset protection planning, acknowledging the ever-evolving legal landscape and the unique circumstances of each client. The authors underscore that while asset protection strategies can be highly beneficial, they must be carefully tailored to each client's specific needs to avoid potential legal pitfalls. The handbook is divided into several parts, starting with an introduction and overview of APTs. This section defines APTs as irrevocable trusts formed in specific jurisdictions designed to protect assets from creditors. It traces the history and evolution of APTs, particularly highlighting the pivotal role of the Cook Islands in popularizing such trusts in the 1980s. The section outlines the fundamental principles that advisors should consider when evaluating asset protection strategies, including the choice between domestic and foreign APTs and the integration of tax planning with asset protection. The second part delves into safer practices for advisors, stressing the importance of defensive practice to mitigate the risk of malpractice and exposure to creditors. It discusses the increased malpractice exposure for estate planners and the necessity of communicating potential risks and limitations to clients. The section also covers ethical and criminal considerations, advising practitioners on how to navigate the complex legal terrain to protect both themselves and their clients. Subsequent sections of the handbook explore various aspects of APT planning in greater detail. These include the lifecycle of a trust used in asset protection planning, the characteristics and structures of different types of APTs, and the specific design features that can enhance a trust's effectiveness. The authors provide practical advice on pre-engagement steps, attorney-client communication, and the collection of client data, emphasizing the need for thorough and clear disclosures to clients. The handbook also addresses the selection of appropriate trust structures, comparing grantor and non-grantor trusts and discussing the implications of each for estate and gift tax planning. It provides guidance on the administration of APTs, including funding, tax compliance, and the use of investment policy statements. The final sections offer sample forms, exhibits, and summaries of relevant statutes, serving as practical tools for practitioners to use in their asset protection planning. Overall, the "Asset Protection Trust Handbook for Advisors" is a comprehensive and practical resource, offering detailed insights and actionable advice for professionals involved in asset protection planning. It underscores the importance of staying informed about legal developments and continuously updating one's knowledge to effectively protect clients' assets while navigating the complexities of tax and legal considerations.