Estate Planning/Asset Protection Using Jay Mitton's System?
Brita
"National Training Conference", founded by Jay W. Mitton
(MBA, JD) who is supposedly nationally known for his
expertise in asset protection.
In essence, the vehicle they propose for asset protection of
families is to create a Family Limited Partnership ("FLP",
based on I.R.C. Section 704), and place all family assets
into it, which includes a "funded revocable living trust"
for estate planning purposes. (There may also be tax
benefits in doing this, but my primary focus is on asset
protection from judgments and estate planning -- when it
comes to taxes and the IRS, I take a conservative position.)
In addition, they claim to have created hard to defeat
clauses/wording for the FLP, including a "poison pill"
making it very unattractive for anybody to go after any
family assets even if they have a "Charging Order". They
claim that the courts have so far upheld these various
"shields".
Obviously, one could simply get enough personal liability
insurance to cover anything, but it is claimed that having
such insurance actually makes one a magnet for lawsuits
("deep pockets"), and with judgments these days being very
high one may not be able to get enough insurance, still
leaving personal assets vulnerable.
Of course, this all sounds too good to be true, so I'm
asking the legal and financial experts here if this is a
valid and working vehicle to both family asset protection
and estate planning. Or is this vehicle full of holes such
that it can easily be pierced to seize family assets for
settling a judgment? Are there other well-tested vehicles to
protect one's personal assets from judgment?
Thanks.
Brita
(Btw, an obvious reply to the above is "if you don't do
anything wrong, you don't have anything to worry about". In
these litigious times, with out-of-control lawsuits for even
the most frivolous things, the many unfair "statutory
liability" laws where you are liable even if logic and
fairness says you aren't, and of course the fraudulent
lawsuits hard to defend against, this is a bogus argument,
one I won't even take the time to reply to.)
<< -------------------------------------------------- >>
<< The Charter and the Guidelines for Posting to this >>
<< newsgroup are at www.Misc-Taxes-Moderated.com >>
<< -------------------------------------------------- >>
Bruce D. Steiner
Take a look at the testimony by Joe Hodges, an extremely
well respected lawyer in Colorado, before the Taxation and
IRS Oversight subcommittee of the Senate Finance Committee
earlier this year:
<http://www.senate.gov/~finance/040501jhtest.pdf>
Then consult with competent tax/estates counsel. The
subject of your question is too complicated for a quick
response in an internet discussion group (or in a seminar).
And, of course, revocable trusts do not provide any tax
benefits.
Bruce Steiner, attorney
NYC and Hackensack, NJ
also admitted in FL
Bill Brown
> Brita wrote:
>> I've twice attended the free sales seminar sponsored by the
>> "National Training Conference", founded by Jay W. Mitton
>> (MBA, JD) who is supposedly nationally known for his
>> expertise in asset protection.
<snip>
> Take a look at the testimony by Joe Hodges, an extremely
> well respected lawyer in Colorado, before the Taxation and
> IRS Oversight subcommittee of the Senate Finance Committee
> earlier this year:
>
> <http://www.senate.gov/~finance/040501jhtest.pdf>
>
> Then consult with competent tax/estates counsel. The
> subject of your question is too complicated for a quick
> response in an internet discussion group (or in a seminar).
>
> And, of course, revocable trusts do not provide any tax
> benefits.
After having attended 4 of Jay Mitton's seminars, I can say
that he does NOT say a living trust provides any tax
benefits. Actually he specifically says they do NOT! Has Joe
Hodges even attended one of Mitton's conferences? Quoting
from the above referenced article:
(Because) "... conferences that are put on by
...Mitton...the existence of trust scams and trust mills has
exploded in recent years." (Sorry-Adobe wouldn't let me copy
and paste the paragraph).
Is Joe Hodges saying because Mitton has put on conferences
talking about trusts and asset planning tools he is
responsible for the scams. If that is the case, then this
newsgroup is also guilty.
What I got from Mitton's seminar's for free (or $29 or $49)
was a grand overview of a very specialized area of law and
accounting. Even if you buy his books ($2990 less 50% at the
last seminar) you will get a better education that you would
from most lawyers and accounts for about the same money.
Would I use his blank forms. Never!!! But I would like to
work with an attorney and CPA that has and can explain the
differences.
Mitton sold me the sizzle, but my local attorney and CPA has
cooked it and served it. But I wouldn't have known I was
hungry if I had not of gone to a Mitton Seminar.
.Jack Brody
protection and tax avoidance in 1995, and I heard one of his
disciples speak in 2001. He apparently now has teams going
out to sell the product at hotel presentations, though he
may still be doing it himself too.
If one can accept the idea that no one should ever lose
money in a lawsuit or pay taxes, and they do make a
sympathetic case for that thought, the legal steps he
proposes do make some sense. The question is whether the
structure will hold up vs. the courts and the IRS over time.
There is also the setup cost (thousands) and continuing
immense legal and tax complexities. I gather that some
people have succeeded by this route.
There was a big change in how they offered the product in
the 6 years. In 1995, Mitton wanted people to travel to
Salt Lake City for several days, while he or his partners
did the legal work for them. He also offered to work with a
local attorney (for a price) for people not inclined to
travel. He did charge admission to the presentation. I
think it was $19/person or couple, and there were some light
refreshments. In 2001, it was free admission, and his
agents were selling do-it-yourself kits to start FLP's and
corporations. I guess they ran out of multimillionaires to
market to and are now going after the larger group of just
millionaires. The special price for members of this
audience was about $2000 for the box of materials, reduced
from $3000. I missed the point when he explained why we
were getting the special price.
The first time, Mitton had a crowd of people around him when
it ended and I left. This time, I watched with my mouth
open as they sold out their stock of kits and took orders
for more, to be shipped overnight. Both Mitton and new guy
were skilled motivational speakers, and very knowledgeable
in tax law. They both answered questions very accurately.
The new guy seemed knowledgeable too, in the practical
operation of sneaky business organizations. Incorporating
in Nevada, getting business agents there to front for you,
etc.
You might want to read Mitton's book, "Cover Your Assets"
that I borrowed from my local library and thoroughly
enjoyed.
Jack Brody
Bruce D. Steiner
> I had the experience of hearing Jay Mitton speak on asset
> protection and tax avoidance in 1995, and I heard one of his
> disciples speak in 2001....
>
> He did charge admission to the presentation. I
> think it was $19/person or couple, and there were some light
> refreshments. In 2001, it was free admission, and his
> agents were selling do-it-yourself kits to start FLP's and
> corporations. I guess they ran out of multimillionaires to
> market to and are now going after the larger group of just
> millionaires. The special price for members of this
> audience was about $2000 for the box of materials, reduced
> from $3000. I missed the point when he explained why we
> were getting the special price.
Shouldn't he pay you $19 to attend. The guys selling living
trusts or time shares usually give everyone a free dinner.
Of course, the one who buys the living trust or the time
share not only paid for his/her free dinner, but also paid
for the free dinners for everyone else in the room.
$2,000 is pretty expensive for a form book. As expensive as
law books are these days, $2,000 would still buy a bunch of
them from conventional publishers.
While having a good set of books is necessary for a good
lawyer, it's not sufficient, any more than a good set of
medical books would make one a surgeon, or a good set of
golf clubs would make one able to compete with Tiger Woods.
Bruce Steiner, attorney
NYC and Hackensack, NJ
also admitted in FL
<< -------------------------------------------------- >>