How Can You Protect Your Assets in Minnesota?
In Minnesota, you can’t transfer your own assets to your revocable trust and protect them from your own creditors, your own divorce, or your own bankruptcy. What you can do, however, is provide protection in Minnesota from creditors, divorce, and bankruptcy for your children or other beneficiaries.
By choosing to distribute assets to your children held in trust rather than outright, you are able to provide protection for your children from divorce, bankruptcy or their own creditors.
The level of asset protection afforded by such a strategy depends on how you structure the trust. Including a spendthrift clause, ascertainable standards for distributions, or even requiring a third-party trustee with full discretion over distributions will create layers of asset protection for your beneficiaries or heirs.
You may also achieve asset protection by using Limited Liability Companies (LLC’s) and Family Limited Partnerships to shield your personal assets from assets owned by those entities. This may be especially important for doctors, dentists, or individuals with rental properties who have significant exposure to liability. Having a properly structured estate plan that incorporates these asset protection strategies is one way to minimize your exposure to liability.
Protecting Assets from Nursing Home Costs in Minnesota
Protecting your assets from being spent on nursing home costs in Minnesota is one of the biggest issues clients face. In some states you are able to transfer assets to an irrevocable trust and avoid having to spend those assets on your nursing home costs. In Minnesota, we have statutes that disallow that strategy.
There are other strategies to avoid nursing home costs in Minnesota including gifting assets and making other testamentary transfers to individuals other than a surviving spouse. If you are concerned about spending your entire estate on nursing home costs and leaving nothing for your children or family, having a free consultation with an estate planning attorney in Minnesota may save you and your family thousands of dollars down the road.