Asset Protection Basics
You are you and I am I. Sound silly? Well, let's see. If someone comes after me, be it an attorney or one of several alphabet agencies, can they get your stuff because they are coming after me? "Of course not! That is silly," you might say. But there is an important point in asking. Did you ever stop and think why someone can't get your stuff for my liabilities? This addresses a very fundamental right recognized even by today's government. And that is the right to own property. i.e. private ownership. If it is mine it can't be yours. (assuming there isn't joint ownership). You and I are separate legal entities. Now let's take things a step further. The law also recognizes trusts as separate legal entities. They can own things just like you and I. Whatever you can own, a **Constitutional Pure Trust can also own. And what belongs to the trust is the trusts, what is mine is mine and the twain shall never meet. So the first and most fundamental element of asset protection is separation. When property is held in a **Constitutional Pure Trust, which is irrevocable it is the property of that trust and not my property. A trust is it's own separate entity and owns it's own property just like you and I. No one owns a trust. To restate it simply, property that belongs to "someone" else isn't mine. And if it isn't mine, it can't be taken from me. The second principle of asset protection addresses the extent of separation. If I own property in my name and my wife owns property in her name, someone coming after me may try to get her stuff (even though it is hers and not mine) simply because we are connected by marriage even though separate persons. However if we are talking about your property and mine , there is no chance of that happening. Simply because you and I have no connection whatsoever. The extent of the separation between you and I is greater than the separation between my wife and I. In the asset protection arena a living trust is a good example of this same concept of the extent of separation. Living trusts are great vehicles for avoiding probate. However most are revocable and therefore do not have a great deal of separation from me as long as I am living. Therefore they provide no protection of property. If I am sued, a living trust can be revoked as if it never existed and the underlying assets seized as if they are mine. This is not the case with an irrevocable trust however. Once property is gifted into irrevocable Trust, (or exchanged in the case of a Pure Trust) I can't change my mind and pull it back out. It is now the property of the trusts and no future event can change that. That decision is irreversible or irrevocable. But for that same reason it is as separate from me legally as it can be. So, the greater the separation the greater the protection. (BUT unlike a living trust, an irrevocable Pure Trust protects property and eliminates estate taxes as well as avoiding probate. In short everything a living trust can do a Pure Trust does AND much more). So property separated from me is protected from my liabilities. The greater the separation the greater the protection. But property must not only be separated from me it must be separated from other property. Which brings us to our third principle of asset protection. A trust is also a "person" by law and therefore can be sued just like any other person. So we want to separate property from property for the very same reason we separate it from ourselves. For example, let's say a trust owns a car, a house, a boat, several stocks and so on. What if the car is in an accident and the owner of the car, in this case a trust, is sued.

What is at risk? Everything else owned by the owner of that car. Now what if a trust owned that same car, but another separate trust owned that same house and another the boat and so on, what is at risk if the car is in an accident now? Only the car! Simply because that is all that trust owns and the trusts owning the house and boat are separate entities from the one that owns the car. To state this another way we can say to separate is to isolate and insulate. Once you understand these 3 fundamental principles of asset protection, 1. Separation of property from oneself. 2. The greater the extent of separation the greater the protection. 3. Separation of property from other property. Everything else makes more sense. There is also one more principle regarding protection that is unique to **Constitutional Pure Trusts over all other forms of asset protection. Constitutional Pure Trusts are separate from statutory regulation. What this means is simply that they exist outside the realm of attorneys, the courts, the government and so on. (as long as they are not engaged in activities that are illegal, which could pull them into the statutory realm). This is hard to comprehend by many. We have been led to believe that statutory law has universal jurisdiction over any and all activities, but it does not. And because Pure Trusts do not fall into the statutory realm, they are often completely unheard of by the vast majority of attorneys and misunderstood at best or even despised by some attorneys as well as CPA's. They are simply outside the scope of statutory authority and therefore outside an attorney or CPA's expertise and government regulation. It would be comparable to the Medical communities' attitude towards vitamins and a natural approach to health. These do not fall in the medical communities area of expertise therefore they know little about them at best or condemn them and seek to eliminate them at worst. In short what we don't know of, have control over or understand is often a threat. And just as Doctors are taught virtually nothing about nutrition in medical school, lawyers are taught virtually nothing about Constitutional law in law school. But, you may ask, "if Constitutional Pure Trusts are not part of the statutory realm, by what authority do they exist?" None less than the Constitution of the United States, Article 1 section 10, under the right to contract. But, you may wonder, "isn't the Constitution a statutory document?" No, it is a common law document, just as Constitutional Pure Trusts are. In truth what makes CPT's so unique is they are not trusts at all by statutory definition ( which is why you will find virtually no information about them in "law" books or statutory regulations ) but are contracts in trust form. Trusts as defined by "the law" ( statutory ) operate in the statutory realm and therefore come under statutory regulation. CPT's do not, which makes them private and protected contracts, free from the "interference" of unwanted parties. This may be the most important form of separation which makes CPT's unique to all other forms of asset protection and therefore the best means of asset protection.

Trust Frequently Asked Questions

A. Trusts have a long history of usage. Plato used a non-profit Trust to finance his university in Greece around 400 B.C. Trusts were known in Roman law as well. In England Trusts were in use as early as the 11th century and by the 15th century were being enforced by the Courts of Chancery. Many burdens and conditions fell upon the holder of legal title to real estate. For example, the lord of the land was entitled to relief or money payments when the land was passed on to an heir of full age. The lord was also entitled to aid or tax money to pay for the marriage of the lord's daughter or the knighting of the lord's eldest son. The owner of the land was usually prohibited from selling the land or dividing it among his children or grandchildren. If the owner of the land was convicted of a crime, he forfeited all he owned to the lord or the king, thereby leaving his family impoverished. These are some of the major restrictions. There were nearly 100 other taxes and limitations on the ownership of land. It was to avoid these restrictions that Trusts were first created in England. They were designed to avoid the application of these rigid laws by allowing the Creator to vest legal title in a Trustee on behalf of a wife, son, daughter or other person as beneficiary. They had many advantages, not the least of which was secrecy. Trusts were also used in English history to allow religious organizations to use property charitably bestowed which would otherwise not be possible due to certain restrictions against land ownership by churches and religious organizations. The English also used (and still use) Trusts to avoid probate of an estate. Pure Trust organizations arrived in America with the colonists. The first **"Pure Trust" of record was drafted for Governor Robert Morris of the Virginia Colony, a prominent financier of the American Revolution, by the famous attorney and patriot, Patrick Henry, in 1765, 24 years before the adoption of the Constitution. Known as the North American Land Company, this Pure Trust is still in operation today, over 200 years later. William Bingham, reputed to be the richest American when the thirteen colonies won their independence, started a Pure Trust for his vast estate in 1804. The Trust owned two million acres in Maine which sold about the time of the Civil War. Bingham, a Senator from Pennsylvania in the Second United States Congress, owned vast land holdings. The Trust was terminated by the Trustees in 1964 after some 160 years of operation. It was terminated because of the multiplication of beneficiaries (total 315) and the liquidation of assets. Throughout the years, the incomes from property and proceeds from land sales were distributed to the beneficiaries. At the time of liquidation, it had no termination date. During its period of existence it was not affected by the death of its Creator, succeeding Trustees, probate procedures, or death transfer taxes. One of the outstanding examples of the Pure Trust is the Mesabi Trust which owns the reserves of the famous Mesabi iron deposits in Minnesota. This Trust receives the royalty payments from the iron deposits and distributes the royalties to the holders of Mesabi's certificates of beneficial interest. Following the transfer of assets from the company to a Pure Trust, Mr. Arnold Hoffmann, then president of the Mesabi Iron Company, announced in the Wall Street Journal on March 14, 1961, that a ruling by the Commissioner of the Internal Revenue declared the Trust would not constitute an association of persons taxable as a corporation. The shares of beneficial interest are traded daily on the New York Stock Exchange. Edward H. Hines, a multimillionaire building supplier, established a $12 million Trust in 1914, and headed his business until his death in 1931. His two sons, Ralph J. and Charles, succeeded the elder Hines as Trustees of the Trust and retained Trusteeship of their father's Trust after a court fight instituted by two nieces, a sister, and a nephew sought to break the Trust by claiming the administration of the family estate had been erroneous. The court ruled that the Pure Trust was not an erroneous method of managing the assets, and was in fact, a valid and legal arrangement for

the estate. Ralph J. Hines, the eldest son and head Trustee, died in 1950, and again the family assets held in the Pure Trust were not disturbed by estate and inheritance taxes. The younger brother, Charles, subsequently became the head Trustee, handling the Trust for many years. Preserved, intact, for future generations, the Edward H. Hines Lumber Company is still in operation today. Another example of the Pure Trust used for a family estate is that of the Joseph Kennedy family. Joseph Kennedy, father of John F. Kennedy, originally established a Pure Trust to own the famous Chicago Merchandise Mart. The Kennedy family is known to maintain several other Pure Trusts for tax shelter purposes as well. One such Trust was reported in the Chicago Tribune. March 22, 1947 with the caption: "Kennedy Divides Merchandise Mart." "A Trust agreement formed several years before, in which Kennedy's wife, Rose F. Kennedy, and a long time friend and associate, John L. Ford, joined as Trustees, helped to materially distribute ownership in the 30 Million Dollar Merchandise Mart, among members of the family. It is said that many of these Trusts are domiciled in the Fiji Islands of the South Pacific." Things have since gone well for the Kennedys. Do you think they enjoyed any tax benefits from how things were set up or were they just exceptional business managers? The below article was recently released in the Associated Press. TUESDAY, JANUARY 27, 1998 Kennedys Sell Last Business AP CHICAGO, Jan. 26 -- "The Kennedy family said today that it had sold its last operating business, the Merchandise Mart in Chicago, in a $625 million deal that unloaded a substantial portion of the family's property holdings. The buyer, Vornado Realty Trust of Saddle Brook, N.J., will pay $465 million in cash, assume $50 million in debt and offer $110 million in securities. The deal also includes other properties in Chicago and in the Washington area. The Merchandise Mart, the centerpiece of the deal, was completed in 1930 by Marshall Field & Company, the retailer, and bought for $12.5 million in 1945 by Joseph P. Kennedy, the family patriarch. The sprawling, 25-story building of limestone and terra cotta is a national center for the home furnishings and design industries, and it remains one of the world's largest commercial buildings. At 4.2 million square feet, the Mart has its own ZIP code and was the world's largest building until the Pentagon was built, in the 1940's. In the deal, the Kennedy heirs will receive a stake in Vornado, one of the nation's largest real estate investment trusts. Most of the Kennedy fortune is in securities, such as stocks and bonds". William Waldorf Astor created a Fifty Million Dollar Trust estate by a conveyance to Trustees, recorded in New York, August 15, 1991, thereby saving his heirs several million dollars which would have gone for probate costs and death taxes had the estate been distributed by the court instead of Trustees. The Rockefeller family has used various kinds of Trusts as a means of maximizing privacy. Before his death in 1937, it is reported that John D. Rockefeller tucked much of his fortune into about seventy Trusts for his descendants. This vast web of individual and group funds represent assets of considerably more then One Billion Dollars. Nelson A. Rockefeller and his generation are believed to have reduced their personal holdings by the creation of still more Trusts for their own grandchildren and great grandchildren. It has been reported to one source that there are "well over 100 and perhaps 250 Individual Rockefeller Trusts". Many of these Trusts are known to be Pure Trusts placing the funds beyond the reach of the high cost of probate. H.L. Hunt, the Texas oil billionaire, is reported to have paid $75,000 for the setting up of the first Hunt family Pure Trust. Hunt then created at least twenty-five additional

(Beneficiaries). Ruth Ray Hunt Trust Estate . management and ultimate distribution of the (Trust Corpus) assets for the persons. entitled to benefit from the assets and/or income held under the terms of the indenture. Q. WHY A TRUST? A. Texas. an individual entrusted with. Q. The death of H. lists more than 80 different and distinct types of trusts that are legally recognized and acknowledged. 5. 4. Black's Law 6ed. Helen Hunt Krelling Trust Estate 7. and the (Trustee).Trusts many of which seem to follow the names of the Hunt family members as follows: 1. WHAT ARE BENEFICIARIES? . Hassie Hunt Trust .This Trust owns a large percentage of the Hunt Oil Company.This Trust is estimated to be worth at least One Hundred Million Dollars. Mr. 2. which expresses the agreement between a person. Caroline Hunt Sands Trust Estate . Q. Avoidance of probate. WHAT IS A TRUST? A. There are various reasons for considering a trust. A trust is a three party contract. Ray Hunt called the purchase by his family's Trust an excellent investment according to the Dallas Morning News. Hunt has not affected any of these Trust estates. Ray Lee Hunt Trust Estate . estimated to be worth in excess of One Billion Dollars. The Trustee is the person into whose control the assets have been-transferred. Asset protection. WHAT KIND OF TRUSTS ARE THERE? A. the protection. the "Ronald Reagan Trust" has enabled him to enjoy sizable tax advantages. Some persons who claim to have been close to the Hunt family estimate that there may be as many as 200 Hunt family Trusts now in existence. (Grantor/Creator). a private legal agreement.This Trust is involved in the new exploratory oil drilling efforts in the Permian Basin of West Texas and Southwestern New Mexico. Business organization. Q. Even Ronald Reagan has established such a Trust. The family has successfully arranged their affairs so as to increase the estate generation after generation rather than see the estate cut to shreds by the high costs of probate. Protection from liability. Swanee Hunt Trust Estate 8. Ruth Jane Hunt Trust Estate 6. While maintaining a magnificent living standard. Q.L. The Trust is based upon the "Indenture". WHAT IS THE TRUSTEE? A. Reagan has.This Trust bought the Jefferson Dallas Hotel in downtown Dallas. These are but a few of the many family estates that are preserved generation after generation through the use of the Pure Trust organization. in some years of Trust operation. Relief from high personal income taxes to name a few. who places assets in a Trust. Nelson Bunker Hunt Trust Estate. It is the duty of the Trustee to ensure that the instructions of the indenture are carried out and the beneficiaries' interests protected. 3. been free of tax obligations. Created in 1966.

Q. grandchildren. ABSOLUTELY!! A revocable Trust is one in which the Creator can change its mind and cancel the contract. Say. The fact is that any "person" living or artificial may be the beneficiary of a trust. since the Constitution says that there can be no legislating of contracts. the value of the revocable Trust is placed in your estate for federal estate tax purposes. There is no "rule against perpetuities" for Pure Trusts. A Beneficiary is any person or persons or any other legal entity. IS A TRUST THE SAME AS A WILL? A. you would not want this type of attack to diminish the assets of the Trust. Q. there is no gain in probate savings. In addition. A Trust is a contract which contains instructions (the indenture) on how assets are to be handled while the . corporation. To maximize the benefits of a Trust it should be irrevocable. As a result. An agreement between the Grantor/Creator and the Trustee that is drawn up in order to define the desires or concerns of the Grantor/Creator. IS IT IMPORTANT THAT THE TRUST BE IRREVOCABLE? A. and due to inexperience. including another Trust. the asset value of the revocable Trust is placed in your estate for probate. Q. While the specific instructions in the Indenture may vary greatly from case to case. or perhaps even incompetent legal advice. Q. For this reason a Pure Trust has a renewable term provision that is usually included as a part of the Trust document. contracts must have a "time certain" for performance. someone sued you. a revocable Trust provides no protection of the estate from future claims against the Creator. Defining the terms and conditions under which the Trustee can be removed or resign. nieces. lack of knowledge on your part. that for no reason at all. To obtain the maximum benefits from a Trust. Anyone may be the beneficiary of a trust. that has rights to future beneficial distributions according to the terms of the Trust Indenture. Under federal law. for example. In some jurisdictions. Defining the Trustee's powers and restrictions and responsibilities.A. nephews. so a contract can't go on forever. the necessary features are: Naming of the Trustee. charitable or non-profit organization or trust. even if you die before the Trust expires. if you revoke the Trust and the assets return to you. In the case of a revocable Trust the judgment creditor could force you to revoke the Trust to allow access to assets to satisfy the judgment regardless of how the judgment was obtained. It should last for at least twenty-five years. Since the purpose of the Trust is to preserve and enlarge the estate. WHO CAN BE THE BENEFICIARY(IES)? A. WHAT IS THE INDENTURE? A. the person who conveys the initial assets to the Trust Corpus. Naming of the Grantor/Creator. a judgment is obtained against you personally. thereby taking back all assets placed into the Trust. A trust is quite different from a will in that a will is a letter to the Court providing instructions for assets to be distributed after a death. That includes children. Describing the assets or initial Trust Property Naming the Beneficiaries. a partnership. However.

etc. Q. The FFA Trust System can effectively protect assets from potential litigants and creditors. farms. is to be done and when. Trusts are and have long been recognized as legitimate entities that can be or own businesses. SHOULD MY BANK SET UP MY TRUST AND BE THE TRUSTEE? . Yes. It is based upon a time proven and Supreme Court proven system of using trusts to hold family and/or business assets. it does not involve hiding assets. Asset protection planning is the adoption of advance planning techniques which place assets beyond the reach of future potential creditors. FFA has assisted over 7000 clients for 14 years in addressing these matters. Q. IS THERE AN EFFECTIVE LEGAL SOLUTION TO THIS CONCERN? A. It allows an individual family or business to defend assets against unanticipated claims. WHAT IS ASSET PROTECTION PLANNING? A. the minutes of the Trust delineate what. At the death of the Grantor. WHAT IS THE SINGLE GREATEST CONCERN PLAGUING WEALTHY INDIVIDUALS AND BUSINESSES TODAY? A.Grantor is alive. A trust serves as a substitute that is far superior to a will. Q. In addition it is effective in deferring many kinds of wealth depleting taxes and yet maintain a great degree of flexibility. Q. land. CAN A TRUST OPERATE A BUSINESS? A. if anything. and how. As a person accumulates wealth they become a target for either some arcane or obscure tax or liability through a law suit where the award can easily exceed the limits of the insurance. Yes. manufacturing. rental property. The proper use of the proper trust allows one to : Preserve and protect assets Defer. WHAT ARE THE BENEFITS OF A TRUST? A. nor is it based upon secret agreements or fraudulent transfers. completely wiping out the company and the company's owners or officers. or eliminate estate tax liability Increase opportunities for accumulation of wealth and estate growth Isolate assets from litigation and liens Create a family estate plan that will work for generations Privacy Avoid lawsuit & judgment losses Enjoy Privacy in business Utilize Asset and income diversification Provide for custody of children's funds Protection for retirement savings Avoid probate and estate taxes Facilitate the transfer of the estate to the heirs Protect assets in the event of bankruptcy Protect assets in the event of a divorce Q. In our system. Q. We live in a society where litigation and punitive taxation have become the greatest means of depleting wealth.

Not known for their altruism. a person with little or no assets. Simply put. Those attorneys who do understand Pure Trusts will share the knowledge with their colleagues and use it for their personal benefit but almost never on behalf of their clients. it is highly unlikely many attorneys would sever this lucrative source of revenue. Assets held in trust are not legally yours. As a rule. NO. a fee that goes directly to lawyers and in many states laws prevent the public from knowing about these attorney fees. If it is too difficult to get to the assets. especially in terms of the amount and difficulty of the work involved. If you review your insurance policies. will result in the avoidance of the probate process for the assets transferred to it. Probate attorneys are very well paid. Dacey claimed that less than 1 % of all attorneys understand the intervivos or living Trust. In addition. I CARRY SIGNIFICANT LIABILITY INSURANCE COVERAGE . Additionally. DOESN'T THIS PROTECT MY ASSETS? A. banks have an atrocious track record overseeing Trusts. a claim can always be made which will exceed your coverage. As well as denouncing the probate racket. HOW DOES A TRUST PROTECT ME FROM LAW SUITS? A. Many lawyers have turned down judgeships to remain probate attorneys. This fact alone will dissuade many potential litigants from starting legal action. including the power to sell and invest them as they see fit without any input from you or reliance on your experience managing these assets. which.WHY SHOULD I BE INTERESTED IN ASSET PROTECTION? A. any asset protection planning which depends upon hiding assets or . When Norman Dacey wrote. Four studies over the last decade confirm that ten to twenty percent of an estate is a reasonable probate fee. it would be extremely difficult. you'll find that they may not cover you for punitive damages or intentional wrongdoing. WHY CAN'T I JUST HIDE MY MONEY IN A FOREIGN ACCOUNT? A. who is a better target. if the bank should choose bad investments and lose all of the Trust's assets. With the Pure Trust you have the ability to choose those individuals whom you deem trustworthy and qualified to handle those assets you have worked so long and hard to accumulate. How to Avoid Probate the American Bar Association fought unsuccessfully all the way to the Supreme Court to prevent publication of the book. The revocable living trust can be a useful estate planning tool. While investing funds in a foreign account may prove to be a worthwhile investment. to hold the bank accountable for its judgment in making those investments. Mr. I ALREADY HAVE A LIVING TRUST. Q. Most banks will insist on having full control over the assets. Some people seem to be quite happy with this arrangement and apparently completely trust the bank's qualifications to manage their assets. but it affords no protection from your creditors. when properly funded. a court can order you to revoke the trust and pay the creditor. As an aside. or a person with liability insurance? Q. It is not easy to find a competent attorney knowledgeable in Pure Trusts and willing to assist you in creating one. Q.A. A very large number of Trusts today are set up and run by banks. Q. Q. often times that is enough to prevent the suit. The business of probate constitutes an extremely large portion of the legal profession's income source. They just do not want to lose the probate business. if not impossible. Many times the decision whether or not to sue is based on the amount of assets the potential target has. SHOULD AN ATTORNEY HELP SET UP THE TRUST? A. If you get sued and lose.

Keep trust assets out of the way of potential liability. IS THIS ALL LEGAL? A. however. CAN THE TRUST BE SUED? A. The trick here is to ensure that any Trust liable to suit has no assets. you have no worries. CAN THE TRUST SUE OTHERS AS WELL? A. So. Q. CAN ASSET PROTECTION WORK IF I AM CURRENTLY IN LIT IGATION? A. If you have already passed ownership of your assets to the TRUST. CAN CREDITORS SEIZE TRUST PROPERTY TO SATISFY PERSONAL DEBT? A. Your assets belong to you. Q. prudent planning and structuring to maximize your efforts and protect assets is not only legal but smart. In such cases there are fraudulent transfer laws (in all states) which permit a court to set aside transfers made at the "eleventh hour". The result has been that Trusts remain a "protected" entity. . The TRUST assets belong to the TRUST. From a tax standpoint. as well. Q. Properly established and maintained Pure Trusts are not taxable entities. Unfortunately. nor may a trust be held liable for a trustee's personal debts. It is a legal entity unto itself. many people first seek to protect their assets after they have been sued or otherwise incurred an obligation. Q. be very helpful during and after litigation. Q. although your planning options are ordinarily narrowed under such circumstances. For more information on this click here. Trust income is taxed to the trust. income that is yours is taxed to you. 10 US Constitution) not to mention numerous laws in the US Code specifying the penalties for interfering with the right to contract. The only liability the TRUST has is it's assets. In addition to that.secrecy is potentially doomed to failure. the only thing they should be able to get is the current assets of that TRUST. a Pure Trust Organization may be used with foreign entities to legally remove funds from the US (tax free) and put the funds into international circulation. there are certain very fundamental guarantees prohibiting the restricting of the "right to contract" (Article I Sec. Yes. The Supreme Court confirms that a trustee can not be held liable for trust debts. they can not get what is owned by the TRUST. You still have to have a mechanism to get the assets back to you. It can. then no one can get at them if they are suing you. If it was to lose a lawsuit and have a judgment filed against it. Q. CAN YOU ELABORATE ON HOW A TRUST CAN HELP AN INDIVIDUAL REDUCE HIS TAXABLE LIABILITY? A. Of course it can. If someone sues you. yes. If the TRUST has limited assets. the individual. In many cases. Q. HOW LONG BEFORE OUR LEGISLATURE LIMITS THE POWERS OF THESE TRUSTS? A. With proper structuring. it's unlikely that trusts will be seriously legislated on because many of our legislators enjoy the benefits of Pure Trusts. Q. Not to mention. WHAT IF I GET SUED? WHAT HAPPENS TO THE TRUST ASSETS? A. it is simple. Yes! If the trust has cause for initiating legal action then the trust may sue. it makes sense to have restructuring completed before litigation is on the horizon. Trusts come under congressional review from time to time. There is no federal law nor any state law that restricts you from doing what is in the best interest of your business and family.

WHAT IS A TRUST CERTIFICATE (TC)? A. those assets are owned by a third entity. GRANTOR/CREATOR. No. Q. Q. You've already transferred ownership of your assets to the TRUST. but you should never imply or say that it is YOUR TRUST. It is an entity unto itself. NO! You are in control of the TRUST if you are the Managing Director. You can say that you "manage a family trust" or you "manage a business trust". before considering a TRUST for family matters. or Beneficiary. and not one of the parties involved in the divorce. in the event of your death. That way. IS THIS CONSIDERED MY TRUST? A. The TC has no ascertainable value. If you do have assets that are not held by the trust. If you feel there may be a problem with an upcoming divorce. Again. WHAT IF I SHOULD GO BANKRUPT? A. This way there is no probate or estate transfer taxes. A Trust Certificate is similar to a share of stock.Q. it's best to resolve the custody problems first. TRUSTEE. they automatically take over your position as Managing Director.death. CAN ARTIFICIAL ENTITIES HOLD THE POSITIONS. HOW DO MY HEIRS TAKE OVER UPON MY DEATH? A. The Trust will remain intact and undisturbed but control will pass to someone else that YOU designate NOW. you need to make sure their name is established as "Successor Managing Director" in the appropriate Minutes. pledged or used as collateral. but it is NOT YOUR TRUST! It is not the Beneficiary's trust. neither party has any marital rights to those assets in the event of a divorce. Q. IS THERE A NEED FOR A WILL IF EVERYTHING IS IN A TRUST? A. The one thing you want to keep current is the Successor-Managing Director that will take over the control of the asset's upon YOUR incapacitation. Q. Managing Director. nor is it the Trustee's trust. WHAT IF I SHOULD GET A DIVORCE? A. the TRUST. . if any. you will want to have a will or a will substitute directing the disposition of those assets. The difference is that while a share of stock represents voting power and equitable ownership of a sort. Partnership or even another Trust can hold the position of either the Grantor/Creator. The TRUST is all an estate needs to direct the proper distribution of profit and assets. AND BENEFICIARY? A. If your heirs simply want to CONTROL the assets like you did before your death. a Trust Certificate represents only the right to future beneficial distributions. it's just a matter of who controls those assets. As a Trustee. this means that no income or gain tax can be assessed to the holder of a Certificate(s). at the time of setting up the Trust. The whole purpose of the TRUST is to set something up for the benefit of the Beneficiaries. Now. Trust Certificates cannot be sold. A divorce has no effect on the assets of the TRUST. there is no change needed. Trustee or Beneficiary. not really. Q. In fact. going bankrupt will have no effect on the assets of the TRUST because neither of the above own those assets. it is not the Beneficiaries' assets either until they are distributed to them upon termination of the Trust or some early distribution as allowed in the Trust Indenture and Bylaws. even though you have most assets in a trust. One thing to note is that once assets are transferred to the TRUST. Q. Yes! Any legal entity such as a Corporation. If your heirs are the beneficiaries of the Trust.or at your request.

You have to be VERY CAREFUL with the wording you choose when dealing with a Trust because there are many people trying to trip you up. the Articles of Incorporation must be filed with the State Corporation Commission and then published with the area legal paper. WHAT KIND OF PROPERTY CAN BE CONVEYED INTO A TRUST? A. It is a separate entity set up for the benefit of the Beneficiaries who do not have a vested interest in the assets yet. Only the Board of Trustees has a vested interest in the assets. You document any transaction that takes place. You will have exchanged ownership of the assets to the TRUST. debts. A trust may own all types of property. You have a contract and receive compensation from the trust to manage it. The actual procedure may vary from State to State. HOW DO I KEEP MINUTES FOR THE TRUST? A. Q. This means there is no limit as to what a trust may own. if you want to pay for things for yourself with Trust assets. NO ONE OWNS THE TRUST! The Trust is an entity unto itself. HOW DO I EXCHANGE OWNERSHIP OF AUTOMOBILES AND HOUSES TO THE TRUST? A. WHAT ABOUT INCOME TAXES? DOES THE TRUST PAY INCOME TAX? A. selling an automobile. What you do is go to the office that handles vehicle registrations and "add" another owner's name to the title (the name of the Trust you created).e. It can cause problems if the name of that corporation is being used by another corporation in that state. the sale of real estate would require a Trustee's signature.When a company incorporates. It is very simple. There are lots of things that you. the trust takes over payments. the procedure is basically the same with one exception. the asset's DO NOT FORM A PART OF THE TRUSTEE'S OWN ESTATE! It is totally separate! Q. anything that has value. (Title 12 of the US Code includes provisions for mortgages in the event of exchange of property into trust. Did you apply for a loan. They may ask questions as to who owns the Trust. and yet. etc. Individual tax situations vary from TRUST to TRUST just as they do from one person to another. The Trust is established to manage assets for the improvement of the Trust. Then you can buy what you need. Automobiles are a little different in each State. you must first earn a salary. buy new equipment. cars. For homes and other real property. i..) through contractual arrangements made in the minutes of the trust. However. For example. Articles of Incorporation must then be filed with each state that a corporation has an office in.) Q. An annual report of officers. Q. DOES THE TRUST PAY FOR MY PERSONAL THINGS? A. etc. etc. Just the major decisions that are made with assets. Q. directors. No. Q. You "warrant" your ownership to the TRUST and the mortgage is not "due" like in a sale. DO I STILL OWN THE ASSETS IN THE TRUST? A. real or personal. Corporation . and what it purchases. as Managing Director can spend money on.e. mainly the IRS. No. This is a discussion that could take days and still not answer everybody's questions as a whole. etc. Pure Trust Organizations (properly established and properly administrated) have no tax reporting requirements. it is only limited by what is conveyed to it.? Many major decisions may require Trustee involvement. WHY IS A TRUST BETTER THAN A CORPORATION? A. buying a piece of real estate. house. opening a business. You can still have "use" of the assets (i. You don't have to detail every aspect of each day's activity when running a business. and . and this is your personal income. Q.

corporations. directors. the largest reason there are not more trusts today is simply ignorance or lack of knowledge. Most people aren't aware of the situations under which a trust could benefit them therefore. and thus. Trusts have been in use for centuries. At death it does avoid probate and "Estate Recovery" in some states. 220 US 178 and Crocker v Malloy. or partnerships) so long as there are three parties. Therefore. A living trust offers some benefits such as avoidance of conservatorship while you are living. WHAT IS A PURE TRUST? A. A Pure Trust is a trust that is made for the propose of managing assets now and also after the death of the person who creates it. in his book "How to Avoid Probate".stockholders must be filed. and if it is. 39 US 270. A Trust can be. It takes a certain amount of savvy to operate a trust. Trustee. Q. is established by contract. Many attorneys are not going to inform you about trusts because they really do not have the knowledge. "A business trust is a common law entity formed by contract. is not subject to the same types of state regulation as a corporation. Many times those who are not afraid to stand apart from the crowd are the ones who earn the greatest reward. A "corporate veil" can be pierced. "Pure Trust Organization". and most people would not read them if they were there. where you live has little effect and it cannot be changed at the whim of a law maker or government administrator. Norman Dacey mentioned. or "Constitutional Trust". There is an old saying. not planning them". Q. WHY HASN'T MY ATTORNEY TOLD ME ABOUT TRUSTS BEFORE? A. The death of the creator (you). Q. "Contract Trust". "I would put the proportion of attorneys who know about and recommend the inter-vivos (complex) trust as less than one percent" You won't find many books about trusts in any library. and Beneficiary." Elliott v Freeman. Trusts are a means of protecting and preserving wealth and securing your future and the future of your family. A Pure Trust on the other hand. "Attorneys make money settling people's estates. Trusts are created under the laws of contracts of the Constitution of the United States. WHY DOESN'T EVERYBODY HAVE ONE? A. It doesn't matter if they are living persons or artificial entities (trusts. Creator. A PURE TRUST is one that is created in contract between three separate parties. There is a lot of misinformation and misunderstanding about the law of trusts. they don't seek out the information. recorded in the County of the State that it is created in. and stockholders subject to lawsuits and liable for all debts. ** Some of the names also used for Pure Trusts are "Constitutional Pure Trust". and are not subject to the same regulations as corporations. Even though there are amazing benefits and advantages to managing your finances in trust many people either out of lack of knowledge or desire overlook them. and those who are aware do not divulge how assets are held for privacy reasons. A Pure Trust accomplishes all the things that a living trust does and more plus you don't have to die to enjoy the benefits. "Common Law Trust". IF A TRUST IS SO GOOD. it often leaves corporate officers. A living Trust is a trust that is made in anticipation of an event. A living trust is an entity which derives its existence from the laws of the state in which you reside which means that the rules can be changed any time. WHAT IS THE DIFFERENCE BETWEEN A PURE TRUST AND A LIVING TRUST? A. "PTO". with a fee. but does not have to be. Q. .

All licenses. Another option would be to sell to the Trust at fair market value.b. could be listed as ACME Trust d. Basically.html Can the Trust use the banks? A Trust can have a bank account in its name.b. the IRS can summon any bank records. the Trust may come under IRC 676. If the Trustor/Settlor (Creator) maintains a beneficial interest and is also the Trustee. Can the Trustee borrow money? The Trust is authorized to borrow money. The Protector is the only one who can question the operation of the Trust. Until credit is established for the for example.a. The business does not necessarily have to have the same name as the Trust. means "doing business as"). a Grantor Trust. the IRS can gain access to domestic bank records regardless of what name the account is under.from http://www. At the present time. . Can the Trustor or others add property to the Trust? Any property can be added at any time by anyone with the approval of the Trustee. To maintain the privacy of an offshore Trust it is essential to use a foreign bank. Can the Trustee sell property? The Trustee can sell Trust property at any time as long as it is done in the name of the Trust. However. etc. It is a separate entity (person). Remember. Who can question or challenge a Trust? No one. this means that the Trust and the "individual" are considered one person and there is no difference between the "individual" and the Trust. not even the Capital Unit Holders can question or challenge the Trust. Should the Trustor/Settlor (Creator) have a beneficial (equitable) interest? No. the contribution would constitute a gift since the shares of capital units have already been distributed.a. the Trustee can co-sign for the Trust. Aggregate Gravel Company (d. Can a business be owned in the Trust? The Trust can own any lawful business..

Some states. do I have to notify the County Recorder each time property is added? No. Does the Trust have to be registered or recorded? The Trust generally does not have to be registered. It is better to have duplicate copies with relatives or friends in the event the original is lost or destroyed. the County Recorder can give you a certified copy. Can the IRS or anyone break the Trust? The only people who can break the Trust are the Trustor(s)/Trustees through their actions of not honoring the Trust and treating the Trust property as personally belonging to them. if they agree. by statute. The advantage to having it recorded is. require that statutory Business Trusts be registered. from one to several. other than the normal recording of real estate deeds. can break the Trust by either written consent or petition to the court. However. its terms and property become public knowledge. the County Recorder does not have to be notified that property has either been sold or added. Once a Trust Synopsis is recorded. the IRS takes the position that the . A one-page Synopsis of the Trust for recording is preferable. How many Trustees are allowed? There can be any number of Trustees. Just remember the Trustees. if your original Trust gets lost or destroyed. If I record the Trust.Should I establish more than one Trust? When you have a business or substantial assets you should have a Total Asset Protection Package comprising a minimum of six Trusts. Can I assign salary or commissions to a Trust? You can transfer all or part of a salary or commission to a Trust in order to get the money under the protection of the Trust. Every man or woman has different circumstances and needs and possibly one to three Trusts would be adequate. whatever their number must be unanimous or at least a majority in their decisions or you end up with a stalemate that must be adjudicated by a board of arbitration or a court of competent jurisdiction. The disadvantage is that the Trust. Is there a limit on property I must own in order to create a Trust? There is no minimum or maximum amount of property that can be held in a Trust. the world is put on notice that the Trust exists. So each state's statutory requirements must be checked. The Trustor/Trustee and all adult Capital Unit Holders.

the transferring of the property and immediate sale would not be a problem. b) dealing in stocks or bonds.e. transferring the property would not save on the taxes you would report. insular possessions or territories) or are involved in "trade or business" within the United States (federal territories). if the property is sold within the first two years of transfer (IRC 644). If a Trust tax return was filed (which it should never do) and the IRS challenged the Trust and the Trustee did not argue the point. Does the Trustee have to file a Trust tax return? .. Does the Trustee have to get a Trust identification number (EIN) from the IRS? Trustees do not need a Trust ID number from the IRS unless the Trust is: a) domiciled in federal territory. individually. In order to lawfully assign earnings to the Trust you must have the Trustee contract with the payor to pay the Trust. according to the IRS. then the IRS will try to take the position that the Trustee and the Trust are one and the same (alter ego or nominee) for collection purposes. The Trust cannot report or pay any taxes on a person's salary or commission. Technically. Can I transfer real estate to the Trust and then immediately sell it? This will depend on whether or not a Trust tax return is to be filed. etc. Washington D. This is why it is important not to co-mingle assets. Trustee. c) required by the bank to have an ID number on a savings account or interest bearing checking account established in the name of the Trust."individual" is still responsible for taxes due on the salary or commission. if you are a "taxpayer" . are still responsible for any taxes on that salary.C. i. Can the IRS seize property or bank accounts that are in a Trust? Not for any liability of the Trustor. d) receiving Trust "gross income" from United States "sources" (federal enclaves. you derive "gross income" from "sources" within the United States (federal territories) or are engaged in "trade or business" within the United States (federal territories). If a Trust tax return is filed. therefore you have no responsibility to admit or deny the existence of the Trust. Does the IRS have to be informed that I have a Trust? No.. but treat assets (corpus) as lawful property of the Trust.. If the purpose of the Trust is to protect the property only." You. the Virgin Islands. Officers or CU Holders. you don't own the Trust and you're not the Trustee. Will the Trust make the Trustor exempt from taxes? The Trust will not make you exempt from taxes if you receive a salary or commission from "gross income.

Money belonging to the Trust can be kept wherever the Trustee feels it is the most safe. then transfer part of the property to another Trust with the same CU Holders. Most state statutes provide that although it is legal to not have a deed (color of title) recorded showing a transfer of property. Do real estate deeds have to be recorded? Yes. even though the Trustor(s) can do this if they choose. The Trust papers are generally kept wherever important papers are kept. transferring the property. a quitclaim or preferably a grant deed is recorded. On vehicles where there is a lien holder. One of the Trustees may remain as sole Trustee of the new Trust. If the lien holder will not approve the transfer. How can I withdraw money from a Trust for personal expenses? Money for personal expenses can be taken out in the form of Manager. the mortgage holder does not have to give permission. See the IRS letter at the end of this document. such a transfer is held invalid unless and until the deed is recorded.. is not kept anywhere. Trustee or fiduciary fees. etc.No. the title should be transferred to the Trust. How do I transfer property that has a mortgage or lien attached? On real estate that has a mortgage. This permission is in the form of a letter stating that: a) they acknowledge and approve the transfer and. What if there is a divorce? There are three things married Trustees can do in the event of divorce: 1) keep the Trust in tact with both parties as Trustees. When the loan is fully paid. Unless there is a due on transfer clause. A duplicate copy should be maintained with a relative . however. filling out a "Bill of Sale" can transfer the vehicle. These can be confidentially maintained in an envelope or storage box. Where do I keep the Trust? The Trust. b) they are still the lien holder. that lien holder must give his approval of the transfer before the title can be changed. It is best. resolutions and receipts. It does not have to be set up in banks or with a lawyer. being a common law contract. 2) both resign as Trustee and appoint someone else as Trustee. This "Bill of Sale" can be secured from any stationery store. 3) decide how control of the property is to be divided. having resigned from the old Trust. canceled checks. to keep minutes. What kind of records do I need to keep? The kind and the method of record keeping is up to the Trustee. The property of the Trust is kept wherever it is located.

but another entity may also be a CU Holder.or a close friend as additional security. a corporation. Does having a Trust put me under equity law? Having a Trust does not put a person under equity law. Family and Business Trusts should always have third party Trustees. A spouse or relative can be Co-Trustee and have equal say as a Trustee. Can I change CU Holders? Once the Trust is in effect the CU Holders cannot be changed. spouse or relative as Co-Trustee. however. Settlor. You may also be provided a signed undated letter of resignation. Can I designate my spouse as Co-Trustee? Yes. The Trustee is a fiduciary and bound by the law to safeguard the corpus for the benefit of the capital unit . however. Can a Trust be sued? Under some circumstances a Trust can be sued. Trustee or Capital Unit Holder unless that person was acting in the name of the Trust as its agent. foreign or offshore. but only for its actions-such as foreclosure on Trust property when a mortgage or lien is not paid. A mortgage foreclosure is always an equity action. It cannot be sued for any actions of a Trustor. you can name anyone you please. as CU Holder. Tax Court is also an equity action where you enter as an "individual" or a Trust (In some states the courts have ruled that the common law will be followed in Trust actions). never yourself or spouse. But to keep transactions arm's length and to avoid piercing the trust by the IRS. CU Holders may also voluntarily relinquish their shares of capital units to the Trustee whereby the resulting shares can be reissued. If you have any doubts. The action or circumstance of any court action is what determines whether one is in equity or not. The relationships of the Trust parties is critical. Can the Trustee abscond with the Trust corpus (assets)? If you are in any way distrustful of the Trustee's integrity he may be removed through the Protector. children either born to or adopted by the Trustor after the Trust is in effect are automatically held to be added as CU Holders. Business Trusts should be maintained at the place of business. The CU Holders of family Trusts are the Trustor's children or grandchildren. Theft would not be an equity action. There is one exception. it is mandatory not to have a Trustor. contact us and we can help you develop a Trust strategy. Who may I name as Capital Unit Holders? Business Trusts generally have another Trust.

If he/she does any fraudulent act. The Trustor does not have legal or equitable title to the property. You can appoint one or all of the CU Holders as long as they are at least 18 years of age. an agreement can be drawn. with the County Recorder and file a new affidavit showing that he/she is the Trustee of the Trust. Who should I designate to take over after my death? As Trustor. If my employer makes out my paycheck directly to the Trust. they can be held accountable for their actions by legal action. The CU Holders only receive what is distributed to them. It can be several people. can they demand everything? At no time can the CU Holders demand any property within the Trust. will that exempt me from taxes? . however. If there are appointed Successor Trustees. These persons should be people you can trust to maintain or distribute the Trust assets as you desire and in the best interest of the CU Holders. they can decide to keep the Trust intact or distribute all or part of the Trust corpus to the CU Holders. signed and notarized or witnessed by all parties involved. If either Trustee needs more assurance. the Trustees would have to surrender his/their certificate(s) of Capital Units. When one of the Trustees dies. It is sometimes difficult for the Trustor to treat the Trust assets as not belonging to him/her. What are some of the disadvantages of a Trust? It is sometimes harder to get credit in the name of the Trust. In that event. The easiest way to accomplish this is to put "and" between the names of the Trustees on the affidavit. the Successor Trustee would record his/her designation. Can a Trust be set up to require multiple Trustees to sign before selling property belonging to the Trust? Yes. Property transferred into the Trust cannot be transferred back into the name of the Trustor.holders. Do the capital unit holders automatically get everything? No. along with the death certificate of the original Trustee. When capital unit holders become 18 years of age. you can designate anyone you choose as Successor Trustee. does the Trust have to file legal papers of any kind? The Trust does not have to file anything when one of the Trustees dies unless there is only the one Trustee at the time.

R. nor add any property to it. To be exempt.F. this can be accomplished using the same procedure as used when originally recorded. it does not come under the rules and regulations of Statutory Law. do I have to record the Trust there? Once the Trust is recorded in one state. Provide a copy of this statue by certified mail to the agent contacting you. Most employers will be reluctant to do this because it is new to them." Do the CU Holders have to belong to the Trust? The CU Holders do not even have to be aware they are CU Holders of a Trust. If. The easiest way to dissolve a Trust is to distribute all property to CU Holders. for some reason. they do not regulate Pure Common Law Trusts. can I transfer that money to the Trust? TThe contract can be sold to the Trust or the contract can be rewritten. If I have sold property on contract and receive monthly payments. After the Trust is in effect. When does the Trust dissolve? Under the terms of a statutory Trust indenture it automatically dissolves 21 years after the death of the last CU Holder. leaving nothing in the Trust itself. Does the Trust exempt me from property and sales tax? No. the employer must contract directly with the Trust and not specify who is to do the work.Not as long as the employer maintains that "individual" as an employee on his books. They do not have to take part in the Trust operation. keeping the terms the same. If I move to another state. is responsible for the taxes on that salary. See the IRS letter at the end of this document. The IRS takes the position that the salary still initially belongs to the "individual" who. By the admission of the IRS itself. . § 1. social security is withheld. it does not have to be re-recorded in any other state. the Trustee prefers to have it re-recorded. The Trust does not exempt anyone from property or sales tax. The termination of a Trust must be outlined in the Trust itself prior to setting up a Trust. and the company has not contracted with the Trust. the courts have held that a Trust can be dissolved when its purpose can no longer be accomplished. A Common Law Pure Trust is not subject to the "Rule Against Perpetuities.861-8. in turn. but changing who is to receive the proceeds. salary is not gross income unless it comes from a taxable activity defined in 26 C. What should I do if the IRS contacts me about filing a tax return? Since the Trust is a Non-Statutory Trust. * By lawful definition.

Successor CU Holders must be named or the shares revert back to the Trust for reissue. excess Trust money can be invested. If a person wishes to eliminate or reduce a "paper trail" or keep his/her and the Trust affairs private. they can write out the specific instructions. Receipts for the deductions will have to be submitted or the IRS will disallow the deductions. Any argument can be taken to the Tax Court or District Court for final ruling. What is co-mingling? Co-mingling is when Trust property and assets are mixed in with personal property and assets. If I don't use a bank. The Successor Trusteewill use the instruction to fulfill your wishes. When the actual owner cannot be determined you also have co-mingling. They do not have to be recorded where the Trust is recorded.What happens to a Trust when a CU Holder dies? By the terms in the Trust indenture. then this audit should be handled as any audit of any other type of return. if a CU Holder dies. his or her issue (children) take the original CU Holders place if his/her heirs are listed as successor CU Holders. then back to the Trust again. However. What about credit cards? Credit cards should not be transferred to a Trust. 664. 676. have it notarized and attached to the designation appointing a Successor Trustee. IRC Sections 673. 644. . Where do you record deeds to property? Deeds to property are recorded in the County where the land is located. and 677 should be reviewed if a Trust tax return is filed. credit cards may be obtained from a foreign bank from an Offshore Trust and still maintain privacy. What should I do if the IRS wants to audit a Trust tax return? If a Trust tax return is filed claiming gross income and deductions. 675. How can you designate what is to be done with Trust property after death of the Trustees? If the Trustor(s) wish certain property to be given to certain CU Holders. where do I keep the money? After paying the bills. It is also where title to Trust property is bounced back and forth between the Trust and a personal name. credit cards should be eliminated. as long as it is done in the name of the Trusts.

Before appointing a Successor Trustee. Can a Successor Trustee be changed? The Successor Trustee can be changed at any time during the life of the original Trustor. Our Trust is not a Massachusetts Trust since it is a Non-Statutory Trust. someone not related. a third unrelated person as Trustee should be selected. as Trustee and/or Cotrustee? If your salary is the only thing being contributed to a Trust. If there is substantial income from Trust property. its activities might be required to be registered with the appropriate state and federal agencies. It is usually formed with some business purpose in mind. The Protector has also been empowered to remove the Trustee for cause and appoint another successor Trustee in his stead. and by the IRS. What is a Successor Trustee? A Successor Trustee is a person (or persons) who has been designated to take over as Trustee(s) in the event that the original Trustee or Trustee(s) die. The existing Trustee simply makes written resignation and designates who the newly appointed Trustee shall be. This choice belongs to the Trustor(s). What is the main purpose of setting up a Trust? . it is not necessary to have a third unrelated person as Co-Trustee. Can Trustees be changed? Trustees can be changed at any time. the Successor Trustee would be ready to assume the duties of the Trustee. A Minute appointing a new Successor Trustee and revocation of the previous Successor Trustee is all that is needed. in the event of the death of the original Trustees.Is it wise to designate a third person. But care should be taken if doing so. as a corporation if it has more than 50% of the six corporate characteristics or indicia and features. Can a Trust be set up as an association with several "partners"? Yes. It may be classified in some states. Because some states have classified this type of Trust as a corporation. it is normally a good practice to inform the person appointed so that. What is a "Massachusetts Trust"? This is a common law pure Trust with beneficial interest certificates that are normally held by several unrelated people. such as business enterprise.

(c) power to revoke and revest ownership in Settlor. It is. boats and aircraft should be placed in their own Trust or encumbered (liened) to the benefit of the Trust. then tax liability may shift to the CU Holder of the Trust. unless the Trustor's possession is postponed for more than 10 years. However. Property is considered transferred to the Trust on the actual date of transfer of the title. or Bill of Sale. death taxes. The transfer in Trust is ineffective to shift tax liability to the CU Holders if Trustor retains the following powers: (a) power to alter or amend CU Holders enjoyment. the main purpose is for the protection of his or her property from probate. The IRS takes the following position: When the Trustor (Settlor) retains a reversionary interest in either the corpus (original property) or income of the Trust. When does the IRS say that an "individual" is personally responsible for taxes due on Trust income? By making all transfers to the Pure Common Law Trust irrevocable. IRC 676. motorcycles. high liability vehicles such as automobiles.For a person whose only income is from salary. there is no personal tax liability. (d) power to designate income of Trust to use of Trustor or his/her spouse. and suit-to ensure and hold the property so that his or her CU Holders or children will be able to have the property upon his or her death. If the consent of an opposing party is required for any of the above changes. . IRC 677. however. If it is a Business Trust the main purpose would be to limit liability. IRC 664. (b) power to borrow without adequate security. The corporate stock would be issued in the name of the Trust rather than yours. IRC 676. Everything in setting up a partnership would be the same. Can a Trust be a partner in a partnership? Yes. All dividends would be paid directly to the Trust. deed. except the name of a respective partner would be the name of the Trust rather than yours. the Trust is taxed to the Trustor. When is the Trust in effect? A Trust is in effect when it is signed. IRS 673 (this is considered a revocable Trust). notarized. preferable in order to protect all your property. and property conveyed to it (funded). reduce taxes and establish privacy of operation. Can a Trust own stock in a corporation? Yes. Does all the property I own have to be transferred into the Trust? All your property does not have to be transferred into the Trust. there is no personal tax liability. By making all transfers to the Pure Common Law Trust irrevocable.

these items should be added to "Schedule A" after the Trust is recorded. some states require the filing and recording of the Trust indenture. one of the beneficiaries. and limitations of the Trustee(s) and officers. The Synopsis outlines the purpose." How do I show in the Trust that property has been added.What happens if the Trustee becomes totally incapacitated? Provided the Successor Trustee or the Protector can verify that the original Trustee is totally incapacitated. When property is sold. the Successor Trustee assumes those responsibilities. you can list any property you want on "Schedule." What about insurance? . The certification identifying the Trustees should also be recorded. or no longer able to perform his duties. lawyer. However. Does the designation have to be recorded? No. a line should be drawn through the item on "Schedule A" and the notation made: "sold on (date). Therefore. or bill of sale should be made out in the name of the Trust and entered on "Schedule A". no longer has the mental ability to manage the Trust. deed. only one piece of property need be listed on "Schedule A" to put the Trust in effect. Should all property be listed on "Schedule A" in the Trust before recording the Trust? When recording a Trust. the adult beneficiaries and/or the guardian of any minor beneficiaries must petition a court to have one appointed. without any Minutes or Schedules. It is probably preferable not to record the designation if there is any possibility that any change may be made as to who would be Successor Trustee. sold. The court can name a bank. that document becomes a public record and anyone can read it. What happens if there is no Successor Trustee appointed? If there is no designation appointing a Successor Trustee at the time of the original Trustor's death or if the Successor Trustee declines the duties and refuses to appoint someone to take his place. Technically. or anyone to be Trustee of the Trust and require that a fee be paid for services as a Trustee. the designation appointing a Successor Trustee does not have to be recorded. What part of the Trust can be recorded? A one-page Synopsis of the Trust is preferable for recordation. duties. or purchased? As property is acquire or purchased. the title. For statutory Business Trusts. if you do not want to have it known that a particular piece of property is being transferred to the Trust.

With car insurance. tobacco.. However. coin collections. firearms wagering. D. furniture. and attach a completed IRS . is foreign to the "United States" (see definition in IRC 7701(a)(31) and therefore exempt from any liability or requirement to file a return. based upon our research. etc. etc. etc. if there are things of great value such as antiques. instruct your insurance agent to add the Trust as an "additional insured". we find no such controversy.. i. valuable jewelry. which are used in business listed? Inventory.e. Inventory items can be listed as the inventory of such and such business.A Trust can have its property insured in the same manner as an "individual". absent any Social Security Number. notify your insurance company to change the beneficiary to the name of the Trust. these should be listed separately. Hand tools and other small tools can be listed as small tools. Washington. however. How does one acquire a nonresident alien identification number for a Foreign Business Trust Organization? The Trustee would complete and file an IRS SS-4 Form (Application for Employer Identification Number). Because medical insurance is for the person who may become ill and not the Trust. used in a business should be listed separately and itemized whenever possible. The Trust must be created in a federal State or territory." in one of the several states of the Union. Are Trusts created in the several states of the Union required to obtain EIN (employer identification numbers) if the Trust does not have "source" "gross income" from the "United States" and the Trust is not engaged in "trade or business" within the "United States"? Some uninformed people consider this as a controversial issue. Any Trust created in any of the several states of the Union (America the Republic). and receive gross income from the United States" (not the Union of States) and or be effectively connected with "trade or business" (see definition IRC 7701(a)(26)) within the "United States" before it is subject to the jurisdiction of the IRS. Since a Trust created." They can be listed simply as "household goods" and "personal effects". An IRS W-8 Form (Certificate of Foreign Status) would be supplied the bank or brokerage account in lieu of an EIN number. is not subject to the legislative acts of Congress. unless the Trust is involved in regulatable and taxable activities such as the manufacture of alcohol. Business Trusts or Family Asset Protection Trusts are treated as nonresident aliens for tax purposes and would not be required to obtain EIN numbers.. How are items. tools. it may pay the premiums for Trustees. How are household goods and personal effects listed? Items in a household do not have to be itemized on "Schedule A. however. it is therefore exempt from any income tax requirements. foreign to the "United States. even for establishing noninterest bearing bank accounts. equipment. outside of any federal enclave.C. With life insurance. the trust cannot have medical insurance.

All information herein is for educational purposes only and is not to be construed as legal or accounting advice. not all professionals are knowledgeable or experienced in common law pure trusts. Section 10 states: "No state shall pass any law impairing the Obligation of Contracts. more commonly known as a "contractual agreement" (which is misapplied since in Common Law." -President Ronald Reagan The greatest secret of the ultra rich for avoiding the hated income tax is A PURE TRUST. 1974) Internal Revenue Code: 7701 The Foreign Situs Trust permits the United States investor to achieve party with the nonresident alien by expatriating his capital. 301.W-8 Form and mail it to the Director of Foreign Operations. Constitution. United States Law and Practice (July." Note that the State can not pass laws which control or influence the "contractual Article 1." from http://centre. Properly structured. and Wolf in their publication.7701.telemanage..that's someone who works for the federal government but doesn't have to take a civil service examination. we recommend you contact competent and experienced attorneys or certified public accountants knowledgeable in common law pure trust matters. so any advice coming from someone without any background should be weighed accordingly. which states in part that a Citizen has the right to contract. only contracts).State as is a corporation or a statutory trust. there are NO agreements. For professional opinions. This tool of the super rich is guaranteed by Article 1.R. Section 10 of the U. Sec.. Furthermore 26 C.F. . a Foreign Situs Trust qualifies as a "nonresident alien individual" and achieves "most favored investor" status for the United States Citizen investing either at home or abroad. NOTE: The information contained in this report is believed to be true and correct based upon available information. Philadelphia. Further." A PURE TRUST is a contract NOT formed by a contract-with-the. According to the law firm of Breen. WARNING. Internal Revenue Service.nsf/articles/5086DB6DE97A77F9852568E0005D43F1 Answers about Pure Trusts Government Is No Longer Your "Business Partner" "The taxpayer -. Pennsylvania 19255. Kator.S. It (the PURE TRUST) is created by a contract between private persons each of whom has the Constitutional Right of Contract..5 states: "The foreign Trust has long been regarded by the courts as nonresident alien individual for tax purposes.

the judgment creditor could pierce the trust and get at those trust assets to satisfy his judgment. thereby taking back all assets placed into the trust. For example. The Certificate Holders are NOT beneficiaries -. THE CONTRACTS OF THE PURE TRUST 1. Between the Trustees and the General Manager for proper functioning of the day-today activities of the PURE TRUST Organization. "Yes. Even if you die before the trust expires. a revocable Trust is one in which the Exchangor (you) can change his mind and cancel the whole transaction.WHY MUST THE PURE TRUST BE "IRREVOCABLE?" To make sure that there is no confusion about the fact that you do not still own the PURE TRUST property. This type of attack could never diminish the assets under a PURE TRUST. if someone sues you for no reason and a judgment against you personally is obtained. Under statutory law. This brings us to the purpose for having Certificate Holders. you would have gained nothing in probate or income tax savings at all." Do the Contracts cancel when the Pure Trust is terminated? Yes. in some jurisdictions.their whole purpose is to be there to assume possession of the . Between the Creator and the Board of Trustees. This provides no protection to the estate from future claims against the Exchangor. regardless of how the judgment was obtained in the first place. if you can revoke the Trust and got the assets back. they do. the assets must be permanently transferred to the PURE TRUST. giving the Trustees fiduciary authority over this artificial person that the Creator and Exchangor created in order to hold some asset. Under federal law. the value of a revocable trust estate is placed in your estate for probate and tax computations. THE IRREVOCABLE NATURE OF EXCHANGING ASSETS INTO THE PURE TRUST If the assets are given irrevocably to the Pure Trust. 3. giving birth to the PURE TRUST. Between the Creator and the Exchangor. In addition. 2. the total value of a revocable trust is placed in your estate for federal estate tax purposes. if you had a revocable trust. can the Pure Trust be disbanded or terminated? The answer is.

This system of law was based upon respect and responsibility. be transferred to the Certificate Holders. I made a mistake. a legal tradition called the "common law. was adopted by the colonialists. should it ever terminate. they applied the principle of the earlier decision. You do not have the chance to say. This "Law" was known as the "Civil Law. not on written rules. just as they earlier were under Roman Law (Civil Law). In the twelfth century." different from the civil law. No one can take your assets away from you. So. imported from England. This body of "laws" owed its heritage to the laws imported and imposed during the Roman occupation. a court did not reconsider that legal issue in a later case where the facts were substantially similar. law in the western world (primarily Europe) evolved slowly over the centuries." The reason there is no question of ownership is because you have irrevocably exchanged ownership into the PURE TRUST. upon its closing. ORIGINS OF COMMON LAW As discussed earlier. most of the common law tradition. "OOPS. These laws were a written list of instructions of how the citizens of the society were supposed to conduct themselves. The irrevocable nature of the PURE TRUST means that the assets go to the PURE TRUST absolutely. I didn't want to put my house in. Misuse of this "Civil Law" system by the King was the source of a great amount of unhappiness and injustice over many years. decided cases. and then be bound by that agreement. but upon the concept that God was supreme. reliable legal forum. but were "common" knowledge among the population. The "common man" lived by the "Common . "stare decisis. This came to be known as the Right of Contract. in the cases above.proceeds of the Trust (the remaining assets)." once a legal issue had been resolved. began to develop in England. the forced signing of the Magna Carta by King John in the thirteenth century established the process of "common law" as a viable. so I'm taking my house back. they reviewed the earlier decisions and if a precedent was found that covered the current case. court decisions were written down and catalogued according to the types of cases. Henry II. and that the citizens had been granted certain unassailable "rights" as a result of being created by God. Finally. They were based. They called this doctrine. or adhere to." Under the rule of "stare decisis. However. An example would be the right to enter into an agreement with one another." a Latin term meaning "To abide by. These laws were not written down. during the reign of the legal reformer." This basic Roman system still prevails in many countries. after the Normans killed King Herold and won the critical Battle of Hastings during their conquest of Britain in 1066. During America's colonial period. the assets of the PURE TRUST would. When the courts had to decide similar issues later. because you have given them up irrevocably.

The Facts. laws have subsequently been passed to make clear that "Common Law" activities are no longer legal." So. It was contained in the Erie Railroad v. Common Law and Civil Law being adopted in this country. For this reason. In fact.S. are almost always appellate court decisions. not trial court decisions. the united States supreme Court solved the problem of the lack of control over Common Law. 2. The Issues. by overturning 100 years of precedent (stemming from the Swift v. The Ruling or Holding. which are taken from the lower court's determination." When the U. The Common Law no longer exists. supreme Court and the state supreme Courts are part of the appellate court systems in this country. 3. New York. This consistency is very important to the statutory law tradition. it was based upon the tenants of the common law. Chapter 12. in some states. or the laws had to be discarded. they made sure that the laws enacted by Congress and the states had to find support in the written law.S." People v. Most judges try hard to be consistent with decisions that they or a higher court have made. and grants powers to the state only so far as is required for the sate to function the way the Citizens desire. such as Ohio. in 1938.] Today. for example.) So we see two different legal systems.Law. which is the discussion. In Ohio." be aware that they are presenting you with a fraudulent document. The Reasoning or Rationale. which is the answer to the issues. "The Common Law is absolutely distinguished from the Roman or Civil Law system. The U. ORGANIC SOVEREIGN AMERICAN FREEMAN COMPENDIUM. "Common Law marriage" is specifically BANNED by statute! [NOTE: If anyone EVER attempts to present you with a document that is written under the "Common Law. which are presented by the appealing parties. wanted to impose the system of statutes known as the "Civil Law" upon the populus of America. Tyson case in 1840) declaring that henceforth. and thus become a part of statute law. It declares that the Citizen is the Sovereign. those who secretly still supported Britain. the Common Law would be "statutorized" and be a part of the statutory or Civil Law in this country. 155 NYS 2d 59 This important distinction which set the Common Law apart from the Civil or statutory law was the bane of those who wanted to recapture control of the "colonies. Constitution was written in 1781. The precedent set by the Erie Railroad v. 4. As a result. all courts in this country today are "statutory" or "Merchant Law" courts. Any graduate of any law school can confirm this fact for you. Ballard. So. Tompkins decision. to this day. (See the establishment of the American Bar Association by delegates of the British Bar Association in 1878 in Saratoga. Thompkins case still stands. The appellate court opinions which appear in published form in the law library follow a format as follows: 1. if . But. the court decisions which are published and available in the law libraries.

you have a good shot at persuading a judge to follow that case and decide in your favor. a case may be considered persuasive authority by many out-of-state courts. PEOPLE OFTEN ASK IF THE PURE TRUST IS LEGAL. authorized. Two Important Questions Q. a court could rule that the PURE TRUST was merely the "alter-ego" of the individual. the PURE TRUST is lawful." and the other is called "persuasive authority. The one main disadvantage of managing a PURE TRUST is that you must not commingle any personal finances with those of the PURE TRUST that you manage. the higher the court. If the earlier decision was a U. You may be shocked to learn that the PURE TRUST is not can find a previous court decision that rules your way on facts similar to your situation. and in that manner. Under persuasive authority. Under Civil Law. Q. WHAT IS THE MAIN DISADVANTAGE OF MANAGING A PURE TRUST? A. as a general rule. . If PURE TRUST funds are used to pay personal expenses or PURE TRUST funds are commingled with personal funds. In the absence of a precedent case. means that the court is compelled to uphold the earlier decision if there is nothing unique or different from the one being decided. However. there are two ways to argue your case when you want to persuade a judge to rule your way. that case is the binding authority on all courts in this country." The PURE TRUST is lawful. and the transfer with the PURE TRUST a "sham". the more persuasive its opinion. although the case may not be binding outside of the state in which it was decided. or sanctioned activity. not because it has to comply with any tenants of the statutory law (because it does not). set the PURE TRUST aside. One is called "precedent authority. As revealed in the definitions of "lawful" and "legal". "An act that is described as "lawful" means that it is an approved. but because it is in compliance with the Constitution of the United States. To say that an activity is "lawful" carries with it a moral or ethical evaluation. supreme Court case. HOW CAN I RESPOND? A. using the principle of stare decisis (to adhere to decided cases)." Under precedent authority. "lawful" means that it is not illegal.

You need to select the one(s) best for you and learn how to use it(them).buildfreedom. The whole tradition of trusts is that they are legal instruments to circumvent the laws of government thieves. accounting. Consider four types of parties: (a) Government thieves. your business. Q. if I give you my car to look after while I'm on vacation. For example. Or if I give you $10. that's a trust.000 to hold on behalf of my son and to give to him on his 21st birthday. There's a wide range of trusts. What is a trust? A. Trusts can take as many forms as there are people to invent them. They can cost anything from $1 to $20. or tax guidance service. or your privacy from unwanted intrusions. It is provided with the understanding that the publisher is not engaged in rendering legal. honest lawyers and people in government!) So a trust is a protective tool or instrument. regulated.wealth4freedom. a trust is created when party A hands party B property to be held by party B on behalf of party A or party C. your income. The basic purpose of the people who masquerade as "government" is to obtain their survival wherewithal through theft. because it's easier to steal than to work . (Despite the cynicism of the foregoing it needs to be emphasized that there are a few good.htm from http://www. The author and publisher assume no responsibility for the consequences of anyone acting in accordance with this information.shtml REPORT #PCT09: PURE CONTRACT TRUST QUESTIONS AND ANSWERS CAVEAT This publication is based on sources believed to be reliable. If legal advice or other expert guidance is required. and to protect against other thieves. your assets. This publication is for information only. (b) Lawyer thieves. Trust users seek to organize their lives and affairs so as to minimize the risk of being robbed. the services of a competent professional should be sought. a trust is a tool to protect yourself. The special features that make the Pure Contract Trust so powerful are covered in . Practically all "legal systems" are designed with deliberate "loopholes" so lawyers can exploit them. (d) Trust users. and spied upon by government. and other thieves.000. layers.see The Economic Rape of America: What You Can Do About It. What's so special about the Pure Contract Trust? A. and also charge their clients substantial fees so they can also exploit the loopholes. GENERAL QUESTIONS AND ANSWERS Q.Source: http://www. Technically. (c) Other thieves. There are also many other thieves constantly looking for wealthy people they can sue or legally steal Most lawyers operate on the same basis. that's also a trust.

Q. That is. What's the function of the Certificate Holder? A. Q. with trustees unknown to you so there's no link between you and the trustees. He or she has a function similar to that of the executor of a will.not the Certificate Holder or anyone else. In a sense. 3) Decide how control of the property is to be divided. adds to its credibility. There are three things a Managing Director can do in the event of divorce: (a) Keep the trust intact with both parties as Managing Directors. Do-it-yourself divorce made easy! Q. Should the Managing Director become incapacitated. The Certificate Holder is appointed by the Managing Director and needs to be a trusted friend. One of the most important is that the trustees (who are sovereign individuals) are provided for you. The Pure Contract Trust is a contract that creates a trust.Report #PCT02. The Pure Contract Trust has the same constitutional rights as any sovereign individual. but to control them. if your original trust document is lost or destroyed." The second advantage to having it recorded is. The ideal is to use an entity that's completely separate from you. The Certificate Holder is comparable to a beneficiary. Does the trust have to be recorded? A. the County Recorder can give you a certified copy. to say. Henkel. Husband gets to be Managing Director of one trust. Can a trust own and operate a business? A. Though he or she isn't a beneficiary. For example. A third factor is that recording the trust gives it an "official birth date" and. The main advantage of recording the Pure Contract Trust is that it enables the Managing Director. then exchange part of the property into another trust. "Acme Holdings dba Aggregate Gravel Company" (dba means "doing business as"). There is considerable case law that defines one of the requirements of a trust being that it has a beneficiary or beneficiaries. A trust can own and operate any lawful business. This enables you to not own assets. it's public record. The business does not necessarily have to have the same name as the Trust. Statutes designed to curb the freedom of tusts are generally worded in such a . and are managed for the benefit of the trust . The only "claim" that the Certificate Holder has is a demand that the terms of the trust agreement be carried out. What rights does the Pure Contract Trust have? A. Why doesn't the Pure Contract Trust have beneficiaries? A. Trusts generally don't have to be recorded. the trust is its own beneficiary. The Pure Contract Trust has no beneficiaries. to freedom from unwarranted search and seizure. the right to do business as expressed by Hale vs. wife of the other. "You need to speak to the principals. to refrain from self-incrimination and all other common law and constitutional rights. you can get their details from the Recorder in Maricopa County. if challenged by a bureaucrat. the right to privacy. Q. What if there's a divorce? A. Q. then the Certificate Holder appoints a new Managing Director in accordance with the trust Minutes and ensures that the wishes of the former Managing Director are carried out. Q. (b) Current Managing Director(s) resign and appoint someone else as Managing Director. The assets are owned by the trust itself. in general.

It's also not suitable to serve as a company with many shareholders. There are sometimes difficulties in opening bank accounts. However. Q. in the event of the death of the original Managing Director. Q. The trustees delegate most of their powers to the Managing Director who manages the assets. the Successor Managing Director would be ready to assume the duties of the Managing Director. Q.way that they don't cover this unique structure . it's a legal person. but only for its actions .they define what they mean by "trust" and their definitions don't apply to the Pure Contract Trust. Can the trustees abscond with the trust assets? A. The Certificate Holder needs to be able to find all the assets owned by the trust and needs to find out what to do with each asset. or. . Under some circumstances a trust can be sued. As long as the Managing Director adheres to the terms and conditions of the trust and the appointment contract. the trustees don't know where the trust is being used and what assets it owns.) The Managing Director does not have legal title to the property and can't pledge it as collatteral. In general. Q. It's sometimes difficult for the Managing Director to treat the trust assets as not belonging to him or her. In a safe place. in the event of the incapacitation of the Managing Director. Yes. Q.such as foreclosure on trust property when a mortgage or lien is not paid. The Pure Contract Trust is definitely not an association and cannot have partners. it can have multiple Managing Directors. Before appointing a Successor Managing Director. No. The trustees don't know the address of the Managing Director. Can a trust be a partner in a partnership? A. Successor Managing Director is a person who has been designated to take over as Managing Director in the event that the original Managing Director dies. What are some of the disadvantages of the Pure Contract Trust? A. except the name of a respective partner would be the name of the trust rather than the name of an individual. Yes. It cannot be sued for any actions of Managing Director unless that individual was acting in the name of the trust as its agent. Can a Pure Contract Trust be set up as an association with several "partners?" A. What kind of records do I need to keep? A. for example if a vehicle owned by the trust is involved in an accident. but accessible by the Certificate Holder. The kind and the method of record keeping is up to the individual Managing Director. The appointment of a Successor Managing Director should be done in the trust Minutes. Q. The trust can also serve the same purpose as a will. Q. The Certificate Holder should be informed. it's normally a good practice to inform the individual to be appointed so that. Everything in setting up a partnership would be the same. Can a trust be sued? A. The records need to be sufficient to enable the Certificate Holder to organize the continuance of the trust. Where do I keep the trust documents? A. the trustees cannot remove him or her. It's sometimes harder to get credit in the name of the trust. Q. What is a Successor Managing Director? A. The trust can't be listed on a stock exchange. (How to open bank accounts is covered in detail in The Pure Contract Trust Manual. The trustees cannot remove the Managing Director without proper cause. without supervision or reporting to the trustees.

Trustees can be changed at any time.S. On this date it is signed." In general." "Golden Resources. In this way the life of the trust can be extended indefinitely." or "Silver Services. Q." So the best way to operate is to organize your affairs in such a way that if you come to the attention of any government agency . The Certificate Holder assumes the role of Managing Director or appoints a new Managing Director. and (b) Some government agencies (including judges) operate on the basis that they're above the law and whatever they say is "illegal" is "illegal. A Trustee can also be removed for cause and and another Trustee appointed Q. In some states there are statutes requiring special licensing of "trust companies. Constitution coupled with Hale vs." There are two basic factors you need to understand: (a) The obligation of contracts clause in the U. The cost for setting up a Pure Contract Trust is $1. When does the trust go into effect? A. Can the Trustees be changed? A. The existing Trustee merely writes that he or she resigns and designates who the newly appointed Trustee shall be. But proving something is legal is more difficult than proving something "illegal." "Family Fiduciary Fund. Under the terms of the trust indenture it automatically terminates 25 years after its creation." "Great Investments. Henkel. What kind of names (titles) should I use for my Pure Contract Trust? A. Q. and property conveyed to it. People often ask if the Pure Contract Trust is legal. Q. How should I respond ? A. because it may attract unwanted attention." "Efficient Management Systems. For subsequent trusts the price is $1. it's not a good idea to have the word "Trust" in the name or title of your trust. as well as filing with the County Recorder." Q. The Managing Director may extend the duration of the trust for another 25 years (or shorter period) through the Minutes. Q. The Certificate Holder should be notified. The Successor Managing Director can be changed at any time during the life of the original Managing Director. A Minute appointing a new Successor Managing Director and revocation of the previous Successor Managing Director is all that's needed." "Midas Holding Company.750. Use names such as "The Acme Foundation. Can a Successor Managing Director be changed? A. What is the current charge for setting up a Pure Contract Trust? Does it cost the same to set up a 'personal' trust and a 'business' trust? Is there a discount for setting up two or more trusts at the same time? A. LEGALITY OF THE PURE CONTRACT TRUST Q. The Pure Contract Trust goes into effect on the date it is created." "Elbow Enterprises. notarized. takes place before the trust documents are delivered to the Managing Director. What happens if no Successor Managing Director has been appointed and and the original Managing Director dies? A. The features of the Pure Contract Trust are such that it's an "all-purpose" trust that can be used for either (or both) personal and business purposes. All this. The educational material furnished covers the basic law and court cases on the legality of this system.450.Q. When does the trust terminate? A." "The Silver Group. This is recorded in the Minutes.

This separation is crucial. Ariz.S.S. Jur. in order to go after "easy pickings.S." 48 Am. Article VI.. Jur. vs. "Where rights secured by the Constitution are involved. 2nd. See Report #TL16B: Sample Correspondence to Beat the IRS. 319 U. then the individual can demand that the government agent provide (a) Proof of the rule.S." Hayburn's Case. Every man has a natural right to the fruits of his own industry. "The right to labor and to its protection from unlawful interference is a constitutional as well as a common law right.S. and (c) Proof that the government agent has the authority to enforce the rule. Madison. 367." U. "This Constitution is the supreme Law of the Land (Common Law). the Pure Contract Trust is designed in such a way that if it's attacked. even though such disobedience may promote in some respects the best interests of the public.. to support this Constitution. (b) Proof that the rule applies to the specific individual.they'll discover that you have no assets and/or you're too tough a nut to crack. Sections 2 and 3. In addition to the above. 384 U. 1. 279 U. In many other trust systems there are links between the user and the other parties. Section 10. 436 at 491 (1966). 210 and 547. much of the risk is transferred from you to them. [If any government agent asserts that contrary rules apply to an individual." U.. 105. 80. making it relatively easy for the enemy to claim that the trust is a sham. This is possible because your name doesn't appear anywhere in the trust document. and you're not worth going after.. Constitution.. U.] "The proponent of the Rule has the burden of proof. 556(d). " Marbury vs. 1 Cranch.S. They need to "collect" extra money. or they'll have to spend too much time finding assets you control." In any case. here are some citations: "No state shall pass any law impairing the obligation of contracts. Constitution. "Law repugnant to the Constitution is void. 16th Am. Butler." Miranda vs. "The judicial branch has only one duty. If they think you don't have money. Sec. 137 (1803). 2nd.) 409." Slote vs.Y. They have quotas to fill. Section 2 at Pg. Board of Exchange." Murdock vs. All judicial officers of the United States are bound by oath or affirmation. You need to understand how the bureaucrats work.C. . Sec. 177.S. 274 N.S. 2 Dall. Pennsy. "A State may not impose a charge for the enjoyment of a right secured by the Federal Constitution.. (2 U. they tend to leave you alone. In other words. Article I. or if they find them there will be liens that effectively stop them. you deflect the attack onto the trustees." Title 5 U. 178. there can be no rule making or legislation which would abrogate them..S. "Disobedience or evasion of a constitutional mandate may not be tolerated. to lay the Article of the Constitution which is involved beside the statute (rule or practice) which is challenged and to decide whether the latter squares with the former.

and confer no right. Does a Living Trust protect my assets? A.."Once jurisdiction is challenged. Ct. it does not protect your assets or your privacy while you are alive. Sec. Q. 157. 9. If someone filed a frivolous law suit against you. and there is consideration paid between the parties.. Utah Power & Light Co. 471. there is no "contract" between two different parties in the sense of the constitutional meaning. (The government generally regards husband and wife as one entity.S. 381. 495 F 2nd 906 at 910. and afford no justification. even on final determination. 768.C. the Pure Contract Trust does. 2502 (1980). So. offer no protection. it must be proven. Griffith vs. There is an offer and acceptance between two or more parties who are of legal age and competent. "Jurisdiction can be challenged at any time. How does the Pure Contract Trust qualify as a contract? A. if one of your children were to file bankruptcy. 556 and 558(b). Living Trusts are revocable. Living Trusts provide no protection against lawsuits or government asset seizures." Hagens vs. he could serve you with a subpoena to produce your Living Trust at a deposition. the bankruptcy court could attach the child's interest in your Living Trust." Basso vs. CONTRACTUAL AGREEMENT Q. Tolmie. Thiboutot. Ct. "No sanctions can be imposed absent proof of jurisdiction. PURE CONTRACT TRUST VS. What's the difference between a Living Trust and a Pure Contract Trust? A. Lavine. His next step would be to get a judgment attaching all assets in your Living Trust. Constitution. it must be proven. Title 5 U. The Pure Contract Trust is irrevocable. Q. thereby exposing all your assets. and there is a termination date. and may be rejected upon direct collateral attach. What are some other differences between a Pure Contract Trust and a Living Trust? A. It's basically designed to reduce probate and estate taxes. Also. Ed. Olsen. Living Trusts are governed by statute law. No. "The law provides that once State and federal jurisdiction has been challenged. 2 Pet. 7 L. 533 Note 3. The Living Trust was created by staute. 415 U." It's difficult for the state to intrude into the affairs of a contractual agreement if the state is not a party to the contract.S." Main vs. 8 Cr.S. 3 L. 74 S." but not a "contract. Most Living Trusts do not qualify as contracts for the following reasons: (a) Usually there aren't two different parties. LIVING TRUST Q. That's why the Pure Contract Trust includes a dispute resolution procedure that is independent of the state.) (b) A Living Trust is a "trust agreement. 100 S." Standard vs. Ed." Thompson vs. all administrative and judicial proceedings are a nullity. One party is usually the Grantor and the Trustee. "Where there is absence of proof of jurisdiction. . including a legal object. Frazier. the Pure Contract Trust is governed by common law and protected under the U. Generally.

The Pure Contract Trust is unique in that it has no beneficiaries. WHAT ABOUT OTHER TRUSTS? Q. The U. Constitution supposedly guarantees that right . No. And even if such a statute were to specifically name the Pure Contract Trust." It's usually formed with some business purpose in mind. The U. It is primarily a contract and secondarily a trust. you may need to acquire more knowledge. Our Pure Contract Trust Manual contains a section on pitfalls to avoid. court will look to substance of circumstances and not labels placed on them by parties. Constitution give citizens the right to contract? A. reporting." Johnson vs. you'll be very safe. Constitution). You have to be very careful how you use your trust. it would be unconstitutional because it's primarily a contract and "no state shall pass any law impairing the obligation of contracts" (Article I.S. If you research these statutes. you'll find that their definition of "trust" does not include the Pure Contract Trust. In order to do that. The enemy is voracious and dangerous. such as a medical practice. Q. Some states have statutes that subject trusts and UBOs to the same licensing. as a corporation if it has more than 50% corporate characteristics and features. and by the IRS. a common law right that antecedes the Constitution." Q. because it can attract the enemy's attention and alert him that you might be a "rebel of substance" whose wealth must be looted. If you don't make the mistakes covered there. According to some articles I read. Does the U. If it's a business requiring government interaction." for example. 517 P 2d 1079. This is a common law trust with beneficial interest certificates that are normally held by several unrelated individuals. The Pure Contract Trust is greatly superior to an "Unincorporated Business Organization" or "UBO.S. reporting requirements. A trust is a tool to help beat the enemy. Hychyk. U. You need to put your faith in yourself and your ability to take correct actions. Every citizen already has that right. It can operate a business very easily. depending on the type of business.S." Is this correct? A. a mailorder business. It's particularly suited for a business that can easily operate "out of sight. and taxation as a corporation. who wants to steal your wealth. A trust can be a double-edged sword. PURE CONTRACT TRUST VS. No. It is very different from a "Massachusetts Trust" or an "Unincorporated Business Organization" (UBO). Can a Pure Contract Trust be used to replace a corporation or limited partnership in doing business? A. Yes. What is a "Massachusetts Trust?" A. Some states have statutes that subject Massachusetts trusts to the same regulation. You may need to develop confidence.S. CORPORATION Q. and taxation as a corporation. It's also very well suited for independent contractors. It may be classified in some states. aren't Pure Contract Trusts and other common law trusts disastrous for people who put faith in them? A. Sometimes it's also called an "Unincorporated Business Organization" or "UBO. My friend took some literature on the Pure Contract Trust to an attorney and was told that it was the same as a "Massachusetts Trust. then it may be necessary to .see Report #PCT08.Q. You may want to cite to your friend the following court case: "Designation of form of trust is not controlling. Section 10. Constitution does not give citizens the right to contract.

The corporation is like a slave owned by a deceitful." It's the usual method of doing business. Q. random. Constitution provides no protection for a corporation or against a unilateral change by the government in the corporate contract. thereby operating as a private business as suggested by Hale vs. Your books and records are open to the public through the State Corporation Commission. What should I tell my accountant? A. It can have a contractual agreement with a Pure Contract Trust whereby the trust leases property to it. It's an exchange of "rights" for "privileges.which only the attorneys and accountants can understand (they claim) . People are brainwashed in schools to use corporations .therefore you have to pay them thousands for their advice. reduce his taxes. Why? Because it's formed under statute law and is subject to all kinds of state and federal regulations . if you didn't have to send them all kinds of paperwork and money. if you didn't have to submit to their regulation . subject to its jurisdiction and statutes that can be changed at any time. thus giving up all your privacy.continue to operate a corporation. you surrender many of your constitutional rights. etc. The Pure Contract Trust is completely private. Our current legal system got the idea of a "limited liability" company from old English history. Why should I as an entrepreneur consider a Pure Contract Trust? A. provides it with services. What is the main reason I should consider a Pure Trust over a corporation? A. That's why major corporations (and aspirants) spend millions to "buy" politicians and bureaucrats. Henkel. The economy of the free world depends on the entrepreneur and the entrepreneur's survival may well depend on his ability to protect his assets. appears to hold out "carrots" or advantages. Make no mistake. When you form a corporation. Q. Simply tell him that you no longer own the business and the new trustees have advised you that they no longer need his services. Q. You must always have an attorney represent the corporate entity. It need not own any assets. A corporation is a "privilege" issued by the state. It's almost always recommended by attorneys and accountants. and submit the names and addresses of the directors. but for most purposes there are both obvious and hidden penalties that far outweigh any advantages. The popular business organization form. unpredictable.S. capricious master (the state). and a sovereign entity not subject to statutory jurisdiction or regulation. Q. covered in more detail in our Pure Contract Trust Manual. erratic." The state operates on the basis that it has the unilateral right to change the rules governing corporations at will. the contract clause in the U. and increase the privacy of his activities. Each year you must report to the state. The state needs slaves. fickle. Why then do people use corporations? A.and to listen to attorneys and accountants. the corporation. It was called a "corporation. file your annual financial status. haphazard. Imagine if your business didn't have to keep records for the bureaucrats. My plans are to replace my business corporation with a Pure Contract Trust. The corporation handles only those functions it absolutely has to.just imagine how much more productive and profitable your business could be! . whimsical. In practice. The corporation is a creature of the state.

" When those assets are placed into the Pure Contract Trust. cash. If any of your employees want out of the system. DUTIES OF THE MANAGING DIRECTOR Q.S. the Managing Director has the power to appoint new trustees. But what if my employees wanted to stay in the system. distributions. Explain the procedure for transferring or exchanging assets into the Pure Contract Trust. TRANSFERRING VS. If there is a remaining trustee.Q. Once the Pure Contract Trust has been created. A wife. Q. or even having to report to the Trustees. Supreme Court has ruled that "if property received in exchange has no fair market value. Can I designate my spouse as Co-Managing Director? A. To whom is the Managing Director of a Pure Contract Trust accountable? A. or anyone else can be Co-Managing Director and have equal say in managing the trust. management. The U. I would be appointed the Managing Director." Burnett vs. It's an "exchange" for valuable consideration.S. Thus. . but with only indeterminable value. These individuals should be people you can trust to maintain or distribute the trust assets as you see fit. There can be up to four Managing Directors. and the Managing Director may appoint new Trustees. Provided the terms of contract (trust agreement) are carried out. You make these arrangements in the Minutes of the trust and clear them with the Certificate Holder. relative. the Managing Director is authorized to conduct the affairs of the trust without supervision by or interference from the Trustees. nor a gift. You can designate anyone you choose as Successor Managing Director. how do I handle them? A. It's more appropriate to use the term "exchanging. EXCHANGING Q. the Managing Director may exchange assets (equipment. You pay them a lump sum every week or month. The trust you manage could contract for services with the trusts they manage. to be sure they will be carried out. The Trustees delegate practically all their powers to the Managing Director. they could set up trusts. Logan. he or she appoints additional trustees. it's not a sale." because that more accurately reflects the nature of the transaction. Yes. decisions. I understand that if I were to purchase a Pure Contract Trust. There can be several people. it does not represent taxable gain to the recipient. What happens if one or more of the trustees dies? A. Q. No other individual or agency can question the duties. husband. Under certain circumstances the Trustees may resign. For those of your employees who want to stay in the system. The only persons to whom the Managing Director is responsible and accountable are the Trustees. the employees are still yours. 404. Q. property. etc. there is no taxable event. For practical purposes. or expenditures made by the Managing Director. you use a personnel leasing company such as Manpower. They handle all the paperwork and interaction with the bureaucrats. but all the red tape is handled by the personnel leasing company.should I designate to take over after my death? A. Who . If all the trustees die.) with the Pure Contract Trust and receive in return a "Certificate of Capital Units. 283 U. The personnel leasing company becomes the employer of record. A.

I think I understand how to exchange my personal assets into the trust with the exception of assets which are already registered with the government.which is done via quit claim or warranty deed then you leave a paper trail. As another example. This permission is in the form of a letter stating that: a) they acknowledge and approve the exchange and. Q." A. ask your DMV to change the title to "(name of trust). Generally. If you exchange your home into a trust . Is there a way to hide this correlation? I. The mortgage note reflecting the $100." A Bill of Sale form can be obtained from any stationery store. real estate that has a mortgage can be exchanged into a trust by recording a grant deed. An option to consider is to sell your home and have a trust you control buy another home. Another option is to have a trust file a lien against your home.000 against the home. If the lienholder will not approve the exchange.000. without the permission of the mortgage holder. Q.000 mortgage mentioned above has a pointer to me. That protects your equity." A month or so later. How do I exchange such assets so that the government registration accurately reflects ownership by the trust rather than by me? A. b) they are still the lienholder. That's why it may be necessary to use several trusts in order to create "watertight compartments. When the lien is fully paid off. In the case of assets that are actually equity in mortgaged assets. and the owner (the trust) is sued. Q. ." Suppose both vehicles and real estate are owned by the same trust. A trust that you manage files a lien of $120. There are two crucial principles involved here: (a) Exchanging assets into a trust with or without leaving a paper trail. the title can be transferred to the trust. my automobiles are registered in my name with the State of Texas.e. It would be a simple matter to correlate the pointer with the asset in question." Ask your DMV to change the title to "John Doe or (name of trust).000 in equity into the trust? Note that in Texas it is not possible to simply get a home equity loan and transfer the cash as this is a so-called "homestead state. that lienholder must give his approval of the exchange before the title can be changed. because if anyone tries to foreclose. The ideal is to have all assets in trust. I own a home worth approximately $200. is there a way to get the name on the mortgage note changed? A. my home is registered in my name. How do I exchange the $100. without any paper trail connecting you with the trust. the vehicle can be exchanged by filling out a "Bill of Sale. A vehicle is involved in an accident. For example." Asset protection can be further strengthened by certain trusts file liens against the trusts holding assets.000 with a 30-year mortgage of $100.. Then all the assets owned by the trust are at risk. I've heard that in some states. Suppose the vehicle is registered in the name of "John Doe. Simply filing a lien against the property solves the problem. Automobiles can be sold to a trust. There is a tricky way that works in some states. they have to pay off the lien first. mortgage companies won't allow this.Q. (b) Having many different assets in the same trust. how is the equity exchanged into the trust? For example. You can also find out from your local DMV the procedure to follow to exchange a vehicle into a trust. Are there any other ways to handle these situations? A. For vehicles where there is a lienholder.

other than the normal recording of real estate deeds. that exchanging assets into the trust cannot leave you insolvent. and later declared bankruptcy to over $40 million in creditors' claims. High liability vehicles such as automobiles. No. Your personal bankruptcy has no effect on the trust assets. Also. should be done well in advance of any "troubles. Q. Any property can be added at any time by the Managing Director(s) to the trust. the County Recorder does not have to be notified that property has either been sold or added. What is fraudulent conveyance? A. whatever arrangements you make. This would be fraudulent conveyance. Suppose the IRS or a creditor sent you a demand for payment of $20. Q.someone with no tax liabilities. or contribute to your personal bankruptcy. PROPERTY Q. motorcycles. Does all the property I own have to be exchanged into the trust? A. Do individuals have common law rights to the fruits of their labor? A. John King placed roughly $240 million into a trust for his family. Q. This is a natural property right and a constitutional right to be protected from unlawful interference from government encroachment. sell or contract is done in the name of the Trust for the Trust." and then try to "hide assets. or without the means to pay your present bills or expected future bills. . Is there a limit on property I must own in order to create a trust? A. and it kept the entire $240 million intact for his family. The safest way to protect yourself against a possible charge of fraudulent conveyance is to arrange your affairs so it's never your assets being exchanged into a trust. then again. Can the trust sell property? A. everything you buy. you should seriously consider changing your status to "nontaxpayer" . What if I should become bankrupt? A.000. boats. Q. then it's best if you cease to "exist" as an entity. however. The court ruled that his trust did not have to pay any of the claims. the exchange of assets into the trust can be set aside as a fraudulent conveyance. If it's legally possible. Individuals have an inalienable right at common law to labor and to the fruits of that labor. If you've exchanged everything you own into Pure Contract Trusts. John King maintained his standard of living throughout the bankruptcy. That is. Q. Q. Once a Trust is recorded. For ideal privacy and protection. Q. I have exchanged everything I own into several Pure Contract Trusts. If so. Do I have to notify the County Recorder each time I add property to the trust? A. all major assets should either be in trust or liens should be filed against them. No. The Managing Director can sell trust property at any time as long as it's done in the name of the trust. There is no minimum or maximum amount of property that can be held in a trust. Yes. You then exchange all your assets into a trust to evade the creditor.Q. What next? A. and aircraft should be placed in separate trusts." If you wait till there's "trouble." you may set yourself up for a charge of fraudulent conveyance. Note here. Can property be added to the trust? A.

You can add an additional pages as necessary. The records also need to be such that..for example. etc. Can the IRS seize property or bank accounts which are in a trust? A. Do real estate deeds have to be recorded? A. do I have to record the trust there? A. though it's illegal. if real estate is to be exchanged into the trust. tools. valuable jewelry. or bill of sale should be made out in the name of the trust. Two of the criteria you apply to decide how to structure such transactions are: (a) Who might see the transaction?. How do I show in the trust that property has been added. On 'Schedule A' add this newly acquired property (real estate. vehicles. deed. Yes. . In practice. then the trust may have to be recorded in the second state. IRS agents sometimes operate as if the trust doesn't exist . etc. or purchased? A. the title. Q. Realize that all this information is private. a line should be drawn through the item on 'Schedule A' and the notation made: 'sold on (date). (b) What will they see? Q. They can be listed simply as household goods and personal effects on Schedule B. Most state statutes provide that although it is legal to not have a deed recorded showing a transfer of property. Some of them operate as if they are above the law. Inventory items can be listed as the inventory of such and such business.' For minor items. if you exchange your house into a trust by quit claim or warranty deed (creating a paper trail). if there are things of great value such as antiques. However.Q. How are items which are used in business listed? A. and the property is located in a state other than where the trust was originally recorded. Yes. Can I exchange real estate into the trust and then immediately sell the property? A. in case of the demise of the current Managing Director. they may simply sell the house. IRS agents can do anything they want. if there is a paper trail from the manager of a trust to the trust itself. In practice.) Q. to sell the trust itself you would have to find a buyer willing to learn how to use the trust. Q. equipment. A very powerful way to protect against this is for another trust to file a lien against the house. Legally they can't seize anything without a court order. use 'Schedule B. Hand tools and other small tools can be listed as small tools. Of course. An "extra front page" of the trust document is provided for this purpose. As property is purchased. furniture. coin collections.. these should be listed individually on Schedule A. such a transfer is held invalid unless and until the deed is recorded. used in a business should be listed separately and itemized whenever possible. Q. Inventory. How are household goods and personal effects listed? A. However. in fact. Records are kept for the benefit of the Managing Director(s). Items in a household don't have to be itemized. and other major items) to the list. When property is sold. Once the trust is recorded in one state it does not have to be re-recorded in any other state. sell either the property or the trust itself (which includes the property). the Certificate Holder and/or new Managing Director will know what is owned by the trust and what they have to do with these assets. sold. You can. If I move to another state. Legally they also can't seize anything for any liability of the Managing Director. Q.' (The trust documents you receive will include Schedules A and B.

445 F2d 144. Q. No." The court quoted Stuart vs. courts have held that a taxpayer may refuse production of personal books. Request that he not phone you. see the Terra Libra tax reports. This issue is covered in considerable detail in Reports PCT05 and PCT06. Does the trust exempt me from property and sales tax? A.. alcohol.TAXES AND REPORTING REQUIREMENTS Q. "U.S. Q. individually. Q.S. Do I have to file a trust tax return? A. and thus is not subject to the same types of state regulations as a corporation. Should I use the banks? A. or anything subject to excise tax. are still responsible for any taxes on any "taxable income" you receive. What are the technical legal reasons why. U.S. Refer the IRS to the principals (trustees) . unlike a corporation. . Dickerson. The Trust will not make you exempt from taxes. therefore you have no responsibility to even admit or deny the existence of the trust. Q. and records by assertion of his privileges against self incrimination. The only exception is if the trust is involved in business related to tobacco. 413F 20 1116." Elliot vs. Only the rare citizen would be likely to know that he could refuse to produce his records to Internal Revenue Service agents. vs. The Pure Contract Trust is not a taxable entity and has no reporting requirements. Q. A trust can have a bank account in its name. the Pure Contract Trust has no reporting requirement to the state? A. You don't own the trust and you're not a trustee. What if the IRS says that an individual is personally responsible for taxes due on trust income? A. Philpott. Kleckner. Do I have to tell the IRS that I manage a trust? A. The trust does not exempt anyone from property or sales tax. 220 U. vs. MONEY AND BANKING Q. If a government agent walks into my place of private business (operated as a Pure Contract Trust) seeking information. 416 F2d 459 and U. If you are liable for taxes. The less you tell the IRS the better.S. Ask him to put his questions in writing. The trust itself is not liable for taxes such as inheritance taxes and capital gains taxes. It also avoids probate. Q. "The Pure Trust is a common law entity formed by contract. 273 F Supp 251. Will the trust make me exempt from taxes? A. "The cooperative taxpayer fares much worse than the individual who relies upon his constitutional rights.see Report #PCT06. 128. you. No. Freeman. State that it's a private business. How to open bank accounts while maintaining privacy is covered in detail in The Pure Contract Trust Manual. Hill vs. firearms. 146 held: "In numerous cases where the IRS has sought enforcement of its summons pursuant to statute (26 USC 7402). No. how should I respond? A. For additional details on how to deal with the IRS.

It's a separate entity (person). Q." co-mingling is strong grounds for claiming that a trust is a sham. notify your insurance company to change the beneficiary to the name of the trust. If you wish to eliminate or reduce "paper trails" or keep your and the trust affairs private. The Trust is authorized to borrow money. The Pure Contract Trust can pay the Managing Director in the form of both salary and expenses.) Medical insurance stays the same as before the trust was implemented because it is the individual who will become ill. the company could contract with the trust to provide services. Unfortunately. Regarding life insurance. Q. (Insurance bureaucrats in some states may require that the trust be "registered with the government" before they make it a beneficiary. Q. For example. You may have to use resourceful means to overcome this problem. The trust can also loan money to the Managing Director. set up a Wyoming Trust. register it as required. Q. All dividends would be paid directly to the trust. will that exempt me from taxes? A. and make that the beneficiary. Can I assign salary or commissions to a trust? A. The corporate stock would be issued in the name of the trust rather than in the name of the individual. Q. organization (or even a corporation) to provide goods or services to that that entity in return for valuable consideration which will be received and owned by the trust. Can the trust borrow money? A. Do I have to get a trust identification number (EIN) form the IRS? A. Q. . persuade a sales person from the insurance company to help you cut the red tape. Your paycheck needs to be made out to you. It's also where title to trust property is bounced back and forth between the trust and a personal name. Q. What is co-mingling? A. It can pledge its assets collateral. How can I withdraw money from a trust? A. you should eliminate credit cards alltogether. Can a trust own stock in a corporation? A. Depositing a check made out to the Managing Director in a trust account would be co-mingling. This is covered in detail in The Pure Contract Trust Manual. A vehicle owned by a trust is simply insured in the name of the trust. Writing checks from a trust account to pay for personal expenses of the Managing Director is another example. A trust can contract with any individual. What about insurance? A. A trust can have its property insured in the same manner as an individual. If my employer makes out my paycheck directly to the trust. You may need a number to open a bank account. instead of employing you. However. some companies will be reluctant to do this. Yes. etc. not the trust. However. Q. What about credit cards? A. Co-mingling is when trust property and assets are mixed in with personal property and assets. credit cards may be obtained from a foreign bank with near-perfect privacy. No. Never use any credit cards in the name of the trust.Q. Apart from leaving "paper trails. but there's usually no harm in asking them.

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