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All too often, we find that a client has engaged in a transaction that involves a trust or underlying entity (such as a partnership or LLC), and later realizes that, in hindsight, the client should have asked legal counsel to first review the proposed transaction for any unexpected issues or “traps.” This has prompted us to create a series of blogs that will identify some of the more common events that come to our attention only after it may be too late to fully reverse the damage. Hopefully, these blogs will serve as timely “heads-up” to those who would have otherwise proceeded with a transaction, throwing caution to the wind.

To kick off this “Think Twice Before You…” series of blogs, we will address situations in which a settlor/creator of an integrated estate planning trust is tempted to enter into agreements or sign documents “on behalf of” the integrated estate planning trust that he (or she) created. If the settlor had thought twice before signing anything, he would have likely recalled that he cannot act for the trust or bind the trust to any agreement. Instead, it is the trustees of the trust who make these decisions and who are empowered with signature authority to enter into such arrangements. If the settlor, instead of the trustees, takes these actions, a creditor could argue that the settlor is in control of the trust and has trustee-like powers, including (just as an example) the power to make distributions to himself. This of course could weaken the protective nature of the trust.

Please look forward to our future “Think Twice Before You….” blogs for other potential “traps” that could be lurking. In general, however, you will see that the underlying message in our “think twice” blogs, is that the client should always consider having a conversation with counsel before engaging in any activity that involves the integrated estate planning structure. It may save the client from unexpected, but avoidable predicaments.


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Seminars & Events:

April, 2017 - CELESQ
“An Asset Protection Planning Primer for Estate Planning, Tax and Creditors Rights Lawyers”
Live Web Cast
May 31 – June 1, 2017 - 

SOUTHPAC TRUST OFFSHORE PLANNING INSTITUTE CONFERENCE 2017, “Asset Protection in a Changing World” (31 May 2017) and “Questions & Answer Panel on Industry Challenges to Asset Protection Structures” (1 June 2017)
Las Vegas, Nevada


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Contact Information

Barry S. Engel
Email: info@engelreiman.com