Personal Property Trusts

These trusts are specifically designed to own personal property. They are not for real estate. They are not for operating a business. They hold title to a single ‘moveable’ asset.

Examples of Personal Property Assets:

• Aircraft
• Class A Motorhomes
• Yachts and Watercraft
• Fine Jewelry
• Automobile Collections
• Wine Collections
• Firearms
• Commercial Equipment
• Antiques and Artwork
• Corporate Stock
• LLC Shares
• Utilities

Owning valuable or dangerous assets in your personal name exposes you to unnecessary risks. A few people with basic trust knowledge place assets into a living trust — which helps for estate distribution but not privacy or legal protection. Others use LLCs and Corporations but those are easily found online by anyone.

However, there’s a better way to own these assets using a “personal property trust.”

General Benefits

• Privacy: Owner’s personal identity and residency is by design invisible to public records and most government agencies.
• Protection: Makes it hard for anyone to establish a direct connection between you and the asset, or your other assets. Naming a different beneficiary for each trust further divides assets and enhances privacy.
• Flexibility: You can add or remove beneficiaries at any time. Change the percentage or dollar amount of distribution to them.
• Variety: You can create multiple trusts to hold a variety of assets.
• Taxes: Obligation of the beneficiaries.
• Beneficiary: Designate a living trust or anyone else as your beneficiary. Immediate transfer of asset upon death. Avoids probate.

Aircraft

Whenever you fly an aircraft in the national airspace system within the United States, it’s departure point and destination along with live tracking are displayed on numerous online public databases. Your FAA registration number is the key index which includes aircraft ownership details. Busybodies, competitors and the media can track your every flight. It doesn’t matter if you fly a Gulfstream, Falcon or Cessna.

Corporate or LLC registration still provide clues to the owners. Nothing but a private personal property trust can totally obscure the true owners. Yet those legal entities for corporate tax benefits or LLC liability protection can work with your trust.

If you need privacy for aircraft ownership use a personal property trust.

Class A Motorhomes

Buyers of premium coaches such as Newmar are often methodical about planning these large dollar purchases. One important item is title, registration and sales tax because it’s different in each state. But in cases where the owner may reside in multiple locations, one state may offer distinct advantages. Yet conflicts arise which can lead to the creation of an LLC or Corporation for establishing residency.

However, they require filings, annual fees, recordkeeping, etc. When it is time to sell the coach, all records and authorizations must be up to date to close the deal. This could be problematic for a multi-state transaction. It’s an even bigger hassle if complicated by a probate sale.

Why disclose your personal name and address to the DMV, or anyone? A personal property trust is much easier and useful in any state. It’s the ideal solution.

Yachts and Watercraft

Pleasure vessels can have ownership issues too. People slip and fall while aboard which may have serious financial consequences. Do you own the yacht in your personal name the same as your other financial assets? This is financially hazardous. An LLC as the owner offers statutory protection yet has public visibility and state requirements. Your vessel owned by a Personal property Trust can slow down or even stop lawsuits and liens because of their unique design. You can also safeguard the boat’s net value from your personal finances. Plus you get flexibility for quiet transfers.

Artwork, Antiques & Jewelry

Your special personal possessions can easily be overlooked in the process of planning your estate. Think about family heirlooms passed down the generations. Maybe it’s a special necklace, family portrait, or antique dining room table. Few people even think about making a written list of such possessions. They may get listed in a living trust which results in transfer after death. But what if you placed selected possessions in a personal property trust today? It would allow for a “present-day” sale, gift, or transfer for tax reasons or to a select beneficiary. And being independent of your estate, you can minimize any potential conflicts among heirs.

If a charitable gift, the personal property trust can provide anonymity for the donor. Can you see how a personal property Trust features might benefit you?

Establishing Provenance

Have you ever wondered how to prove ownership of an untitled possession? A personal property trust can establish the provenance (birth certificate) for artwork, antiques, or jewelry, etc. You now have legal ownership papers for that item – to sell, inventory, or transfer. Maybe you prefer to remain the discrete owner.

Wine Collectors

California and Bordeaux cult wine collectors can segregate various lots or libraries of wine by title. Few ever think about ownership beyond the bill of sale. Most people own wine personally for their pleasure. However, while many wine collectors are proud of their cellar, others prefer privacy at auction for a variety of personal reasons.

With the Personal property Trust a collector can buy, hold and sell wine with complete anonymity. When high value wines are sold at Meadowood, Sotheby’s or Christie’s auction, privacy can equal strategic advantage for you. Others are proud to name their collection.

Insurance policies in the name of a wine trust is smart and safe too.

Automobile Collectors

Select automobiles continue to have value as worldwide collectibles. Unique design, race history, celebrity ownership and a variety of other factors have created this exciting market. Yet ownership title is often overlooked. Vehicles are generally owned in personal name by default – it’s easiest. But personal injury blamed upon a wealthy owner can have financial consequences. Did the estate of Paul Walker sue the Carrera GT owner? A Personal property Trust can provide you with a layer of protection and safety.

Events such as those at Pebble Beach or Villa d’Este are high profile for collectors and the media. Strategic buying and selling is enhanced with privacy. Rather than transferring legal title, just sell the shares.

Heirs

If you are giving a financial gift such as equities or property to an heir setup a personal property trust. This can provide a repository for future gifts and safely isolate those assets in one place for the heir. Early gifting can allow profits and gains to grow outside the donor’s taxable estate.

Commercial Equipment

By placing equipment such as machinery, service vehicles, or other items that can cause personal injury into a personal property trust a business owner can reduce or mitigate liability claims.

LLCs and Corporations

Keep your name off secretary of state annual filings. Rather than you personally, use a personal property trust as the Director, Officer, or Managing Member. This complies with their requirements for each position yet slightly alters the reporting.

Stock and Shares

If you have a corporation or LLC use a personal property trust to conceal your ownership. Have your registered stock issued to your Personal property Trust. Or have your LLC membership issued to your Personal property Trust. Haven’t you in effect created bearer shares?

Limit Your Liability and Costs

Motor vehicles are dangerous in terms of liability because they can cause personal injury. By isolating them with a personal property trust you might accept a lower level of insurance coverage. This is because any liability suit will target that sole asset. Yet be forewarned, insurance does not cover all perils and lawyers can also sue the driver personally.

Utilities

You might buy income property in a land or business trust but neglect to consider vendor or utility accounts. Use a personal property trust. Get safety from tenants and the public in general. These small accounts are where mistakes can open the proverbial can of worms.

And if you’ve had personal credit problems, bankruptcy, or other financial challenges, establishing utility accounts can require large deposits. Setting up the account for any utility (i.e. water or electricity) in the name of a trust is a good way to buy time while re-establishing creditworthiness.

Summary

These are just a few examples of ‘what’ you can do with a personal property trust. Assignments and conveyances do require careful execution. Benefits include reduced lawsuit exposure, safety from liens, camouflage equity, avoid probate, etc.