Preserving Your Future: A Guide to Asset Protection in Florida

Protecting the wealth you’ve worked hard to build is a key part of sound financial and estate planning. Florida law provides strong protections for certain types of assets, and additional legal tools are available to further safeguard your property from creditors, lawsuits, or unexpected claims.

At Preservation Law Firm, our Largo estate planning attorney helps individuals and families take proactive steps to preserve their assets, provide for loved ones, and ensure long-term financial security.

Assets Already Protected Under Florida Law

Florida offers some of the strongest built-in asset protection laws in the country. Certain assets are automatically protected from most creditor claims, including:

• Homestead: Florida’s homestead exemption protects your primary residence from most creditors. This protection is unlimited in value, covering up to one-half acre within a municipality or up to 160 acres outside of one. While mortgages, taxes, and liens for unpaid work remain exceptions, this protection generally ensures that your family home cannot be taken by creditors.
• Life Insurance: The cash value of life insurance policies and death benefits payable to beneficiaries are generally exempt from creditors, ensuring loved ones receive intended financial support.
• Annuities: Annuity contracts are protected from garnishment and legal claims, making them a valuable tool for long-term planning.
• Retirement Accounts: Qualified retirement accounts such as 401(k)s, IRAs, and similar plans are largely protected, ensuring your retirement savings remain secure.
• Wages: Florida law exempts the head of household’s wages from garnishment up to certain limits, helping families maintain essential income.
• Personal Property: Certain household items, clothing, and furnishings are exempt from creditor claims up to a specific value, protecting essential daily living property.

Additional Asset Protection Tools in Florida

In addition to these inherent protections, Florida law provides several legal and financial strategies that can further safeguard your wealth, including:

• Joint Tenancy by the Entireties (JTBE): Exclusive to married couples, this ownership structure shields jointly owned property from the creditors of one spouse. If one spouse faces a judgment, creditors generally cannot seize JTBE assets.
• Corporations and Limited Liability Companies (LLCs): Properly structured business entities help separate personal and business liabilities. Multi-member LLCs in Florida often provide stronger asset protection benefits than single-member LLCs.

Important Considerations

While Florida law offers significant protections, there are important limitations and misconceptions to be aware of:

• Revocable Trusts: These trusts are excellent estate planning tools but do not provide asset protection. Only certain irrevocable trusts may shield assets, and doing so often requires giving up ownership and control.
• Fraudulent Transfers: Moving assets with the intent to defraud creditors is not protected and may carry serious legal consequences.
• Timing Matters: The most effective asset protection strategies are implemented long before a lawsuit or creditor issue arises. Planning early is key.