Protecting Privacy In Estate Planning

While most think of distributing wealth when they hear about estate planning, those with high-net-worth seek to distribute their wealth discreetly. Indeed, estate planning involves sensitive information concerning assets, family, and final wishes. Such information, if made public, could lead to unwanted attention and publicity, family disputes, and attacks from frivolous lawsuits. An East Greenwich, RI trust lawyer who has helped families with net worths as large as $300 million is here to explore the various aspects of privacy and confidentiality in high-net-worth estate planning.

Publicity Of Probate

Many people are surprised to learn that the probate process is a public process. This is particularly concerning for high-net-worth and high-profile individuals. Because probate filings are public records, anyone can access details about wealth, debts, and heirs. This can make your family and heirs targets. Worse, publicity in newspapers or gossip magazines.

Protecting Privacy Through Trusts

Trusts are an effective method of preserving privacy. Indeed, trusts are not public documents. Depending on the state, the only people permitted to see the full trust document are the beneficiaries or heirs at law that may not be beneficiaries. In most states there is no requirement to record trusts. When trusts are required to be recorded, often, only a certificate of trust is required. A certificate of trust identifies the trust, trustees, and the powers of the trustees, but does not typically require information regarding assets or beneficiaries.

When using trusts, it is important to properly title assets in the name of the trust. Failure to properly title assets can result in those assets being subject to the probate process.

Some states permit what are called “silent trusts”. Silent trusts are not only protected from the probate process, but are also kept secret from the beneficiaries for a period of time. Sometimes they are not disclosed to beneficiaries for up to twenty-five (25) years. Some reasons for silent trusts are to prevent beneficiaries from being unproductive, if the beneficiary has substance abuse, behavioral, or mental health issues, or is in a troubled marriage or other relationship.

Appointing an independent professional trustee to the trust can further reduce the chance of disclosure. States like Nevada or Delaware offer robust privacy protections along with no state income tax on trusts.

Layering Privacy With LLCs

In most states, limited liability companies (LLCs) are not required to disclose the identity of its members. By transferring assets such as real estate, investments, or intellectual property into an LLC, high-net-worth individuals can keep their identity as owners off of public records. This privacy protection is further strengthened when the member of an LLC is a trust.

Learning More About Privacy

For high-net-worth and high-profile individuals and families, privacy is of utmost importance. Public exposure can create lawsuits, unwanted media attention, or safety and security risks. There are many ways in addition to those discussed for high-net-worth and high-profile individuals and families to protect their privacy. A lawyer can help you determine how best to protect your sensitive family and financial information through these and other estate planning techniques. Founded in 2014, Aptt Law LLC is ready to put our years of knowledge to work for you in forming your estate plan. Contact us today!

Disclaimer:

The Rhode Island Supreme Court licenses all lawyers in the general practice of law, but does not license or certify any lawyer as an expert or specialist in any field of practice. This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice, nor the formation of a lawyer client relationship.
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Disclosure Under IRS Circular 230: Any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any tax-related transaction or matter.

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  I’ve had the privilege of knowing Geoff on a professional level for the past four years. We have cross multiple times because we travel in circles of like-minded entrepreneurs dedicated to seizing the incredible opportunities available to us in this amazing country. Equally important, we share a commitment to taking the right steps to protect our assets and achievements. Within this circle, we’ve exchanged invaluable insights and expertise, helping one another grow as professionals and individuals. This collaborative environment is what gave me the confidence and assurance that Geoff is the correct professional to guide me when I needed a comprehensive strategy to safeguard my hard-earned assets and ensure my loved ones avoid unnecessary probate complications. While many can set up a trust, Geoff goes beyond the basics. He obviously takes the time to understand your perspective, values, and vision for the future. I highly recommend Geoff not only for his exceptional knowledge and service but also for his firsthand experience as an active investor and his connection to a high-quality network of professionals focused on building generational wealth.
  
 
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  Geoffrey is extremely professional and accommodating. He stated a price within the first 15 minutes of meeting us to ensure that we were aware of what to expect and explained all aspects of our paperwork clearly. Geoffrey also made arrangements to work around our schedule. I would gladly recommend him to anyone seeking an estate lawyer.
  
 
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  Geoff and his paralegal were both amazing in guiding my wife and I through our trust journey. I feel they truly cared about our children's future as they laid out our options in great detail, and they made sure the things we decided on paper met our fullest intent. Even as we made changes right upto signing the final product.
  
 
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