Physician Insurance

Physician investment planning needs to consider malpractice worries, not just investment returns. The structure (who owns an investment) is important. Significant assets rarely belong in your own name. Titling assets in your spouse’s name is also insufficient. LLCs and trusts are likely a better option. Be sure that the accounts are set up in the name of the entity, and that an investment policy statement is signed in the name of the entity by the appropriate person. The income tax ramifications of using a trust or LLC are important and need to be addressed with your accountant. If you are setting up a domestic asset protection trust, the investment structure should be reviewed. Will the trustee directly invest assets, or should the trust own an LLC that owns the actual assets and someone else addresses investments? State income tax issues may be very different since these trusts are almost always in a state other than the state you reside in. Insurance should be evaluated from a different perspective. For example, even if term insurance meets your insurance needs, it might be preferable to have a permanent insurance product owned in an irrevocable trust to safeguard a cash value. Your spouse could be a beneficiary and have access to the cash value in the policy through trust distributions. Non-deductible IRAs are almost always recommended (for asset protection, not tax benefit), because the assets in them are protected for up to $1M under the revised bankruptcy act.