Asset Protection Trusts

At one time or another you may have faced the specter of a lawsuit that threatens your personal wealth.

Individuals in some professions are more likely than others to face an increased risk of lawsuits, including entrepreneurs and corporate board members. But there is a way to help protect your assets from potential future liabilities.

Establish a Delaware Asset Protection Trust to help your assets stay in your hands.

Delaware law permits you to establish a special type of irrevocable trust that, when properly done, may protect your assets from creditors. To establish a Delaware Asset Protection Trust, you transfer selected assets that, once transferred, may be insulated from future creditors.

How do trusts work in general?

In simple terms, a trust is a legal entity that you create with your attorney by a written document in which you authorize the trustee to manage the property transferred to the trust for the purposes that you specify within the trust document. While the trustee holds legal title, you or designated beneficiaries, retain beneficial title, and the trustee is legally obligated to operate within the terms of the the trust and applicable law.

Can I retain control over the assets placed in an Asset Protection Trust?

As grantor, Delaware law permits a trust to allow the grantor, during his or her lifetime, to direct the investment of the assets; to receive income and principal, and to veto distributions to third parties. As grantor, you can also retain the power to distribute the assets through a limited power of appointment at your death. To protect your assets, you may relinquish some control over the assets, but losing control does not mean losing all of the economic benefits from the property transferred. If you're concerned that your assets might be at risk, PNC Wealth Management(R) can work with your legal counsel to create a customized solution to meet your needs.

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The PNC Financial Services Group, Inc. (“PNC”) uses the marketing name PNC Wealth Management® to provide investment and wealth management, fiduciary services, FDIC-insured banking products and services, and lending of funds through its subsidiary, PNC Bank, National Association (“PNC Bank”), which is a Member FDIC, and to provide specific fiduciary and agency services through its subsidiary, PNC Delaware Trust Company or PNC Ohio Trust Company. Securities products, brokerage services, and managed account advisory services are offered by PNC Investments LLC, a registered broker-dealer and a registered investment adviser and member of FINRA and SIPC. Insurance products may be provided through PNC Insurance Services, LLC, a licensed insurance agency affiliate of PNC, or through licensed insurance agencies that are not affiliated with PNC; in either case a licensed insurance affiliate may receive compensation if you choose to purchase insurance through these programs. A decision to purchase insurance will not affect the cost or availability of other products or services from PNC or its affiliates. PNC does not provide legal, tax, or accounting advice unless, with respect to tax advice, PNC Bank has entered into a written tax services agreement. PNC does not provide services in any jurisdiction in which it is not authorized to conduct business. PNC Bank is not registered as a municipal advisor under the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Act”). Investment management and related products and services provided to a “municipal entity” or “obligated person” regarding “proceeds of municipal securities” (as such terms are defined in the Act) will be provided by PNC Capital Advisors, LLC, a wholly-owned subsidiary of PNC Bank and SEC registered investment adviser.

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To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account.

What this means for you: When you open an account, we are required by Federal law to ask for your name, street address, date of birth (for natural persons) and other information as required to identify you. This may include a request or requests for confirmatory information such as presentation of your driver’s license and/or other document(s).

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