Asset Protection for Professionals and Business Owners in Florida

Asset protection planning is designed to shield assets against risks posed by lawsuits, potential creditors, or pending bankruptcy. Asset protection is especially important for professionals and business owners whose personal assets may be at risk in the state of Florida.

Exempting Assets in Florida

State and federal laws exempt some assets from the claims of creditors. Click here to download a listing of Florida’s exempt assets. Some states allow creditors to choose either the state or federal exemptions; however, in Florida, creditors must use the state exemptions, and federal bankruptcy exemptions are not available. After identifying the protected asset classes available under applicable law, it may be prudent to convert any remaining non-exempt assets into exempt assets.

Limiting Liability for Professionals & Business Owners

Some people choose to operate their businesses as sole proprietors instead of operating through a legal entity, such as a corporation or a limited liability company. Conducting business through an incorporated legal entity may offer substantial risk management benefits over the sole proprietorship, but selecting the appropriate legal entity is critical to managing risk.

Transferring Risk with Insurance

When was the last time you reviewed the details of your liability insurance program with your insurance professionals?

• Are your policies current?
• Are the coverage limits adequate and are the deductibles reasonable?
• Have you scrutinized the policies for loopholes?

Remember: the fundamental philosophy of any insurance coverage is to pay a premium you can afford to transfer a risk you cannot afford. Take time to understand both the risks you have retained and the risks you have transferred.

Probate is one manner in which estate assets are transferred after death. Since probate can be a lengthy, costly and public process, many people choose to avoid it. Without proper probate avoidance planning, the state will require a probate court proceeding for state residents or those who owned assets in the state. During probate, assets are managed, debts are paid, tax returns are filed along with various court documents, and the estate assets are distributed.

In the absence of any planning to the contrary, your estate will be distributed according to Florida's laws of intestacy. This so-called "default" estate plan might not reflect your wishes. However, if you do plan in advance, you can have your estate administered according to your preferences. A comprehensive estate plan may include a Last Will and Testament, Trusts, Powers of Attorney, Advance Directives and Health Care Documents, all supporting your legal, personal, investment and tax planning purposes.