Actually, the primary reasons most people set up a PTO are privacy, liability protection, and freedom from probate and inheritance taxes.

However, PTOs do not have any inherent tax liabilities.  A PTO will sustain a tax, however, if it engages in a taxable activity.

No. The reason a Pure Trust protects property for you is because you give up ownership of the property, along with its inherent liabilities. However, you retain the beneficial interest in the trust.

This also means that nobody can make a claim against the property held in trust to satisfy an alleged grievance against you.

When you put property into a PTO, you divest yourself of legal control of the property.  However, in a properly designed PTO you retain practical control, which is what most people want in the first place.

The question of who has legal control over the property determines whether or not the trust will actually be successful in protecting the property from regulations, taxation, control, etc.

You can ensure that your wishes concerning trust property are respected by working with your Protector, whose job is to protect your interest in the trust.

 

No.  Trust property does not belong to you, so it cannot be attached in order to satisfy a claim against you.

Property taxes are assessed because real property has been recorded with the County Recorder or Registrar of Deeds.  There is no law requiring a property owner to record his property, so the recordation of same is considered to be a voluntary use of government services.  The property tax is assessed as a result.

If you wish to opt out of property taxes, first be advised that you should not attempt to do so unless you are prepared to fight that particular battle.  Opting out of property taxes will someday likely result in a direct
confrontation with government, which will not let go of control of property easily.

For more information on opting out of property taxes, call 888-385-3733 to set up a consultation.

Am I liable for income tax on payments made to me by the trust?

No to both questions.  Earnings that come into the trust belong to the trust, which has no IRS reporting requirements or inherent tax liabilities.

Further, any payments made to you by the trust, whether salary or distribution, are private in nature and therefore, unless you choose to report your private earnings to the IRS, you are not liable for income tax on those amounts.

Freedom Bound International is the Creator of our PTOs and so cannot act as Fiduciary Owner.  Brent Johnson can act as your Fiduciary Owner.  Also, Brent has trained others to act in this capacity.  Contact Freedom Bound International at 888-385-3733 for current information on Fiduciary Owner fees.

A PTO is a private contract, so it is fair to say that a trust operates under contract law.

Additionally, the U.S. Constitution, Article 1, Section 10, prohibits government from obstructing the obligation of contract.  In other words, private contracts are constitutionally protected from government infringement.

No. Never.

Our trusts have sustained both IRS challenges and court proceedings.  In each and every case, our trusts have been left alone.

In the case of the court rulings, they involved spouses of clients who were divorcing their husbands, and who wanted to pierce the trust veil of protection.  In each case, the courts refused to pierce the trust veil, thereby upholding the status quo.