Arizona

The information given on this page is for educational and informational purposes only, and does not constitute any legal or tax advice or opinion. This page is meant to give a quick start to research by other professionals, but it should absolutely not be relied upon for any purposes whatsoever. Additionally, this page is kept current only as our time allows, and the information given here may not be current. We make NO GUARANTEES as to the accuracy of the information herein and you should not rely on it. Even professionals who use this information must independently verify whether it is correct and current.

Nothing in the information given below should imply that the drafters of this webpage are admitted to practice law in the referenced state or have any special expertise in the areas listed. Nothing herein should be construed as a solicitation by the drafters of this website to practice law in the referenced state. Persons desiring planning should contact a licensed attorney or other appropriate planning professional in this state. Certainly, nothing herein is any substitute for the services, advice, or counsel of a properly licensed attorney in the relevant state!

Arizona Asset Protection Overview

Only the state exemptions are allowed in a bankruptcy proceeding in Arizona.

Arizona law prevents a creditor who holds a charging order against an LLC from foreclosing on that interest and thus taking that interest (this does not mean that the creditor gets the assets held in the LLC, so this advantage is of dubious benefit). Nonetheless, some planners in other states use Arizona LLCs because of this feature.

Otherwise, for asset protection Arizona is a mixed bag since only minimal protection is given to homestead or the cash value of life insurance policies, but annuities, IRAs and pension plans can offer very substantial protection when properly designed.

Unfortunately, Arizona is among the top tier of states having more than its share of flakey asset protection planners who slam people into offshore trusts that they often don't need and are likely to backfire when real trouble arises.

Arizona Statutory Creditor Exemptions

For additional detailed information on the use of life insurance, annuities, pension plans, and employee benefit plans for wealth preservation and asset protection, see advanced life insurance

Arizona Homestead

• The homestead exemption in Arizona is $150,000. The sale proceeds are exempt for 18 months after the sale.

Statute

Arizona Homestead Cases

• In re Robin Bruce McNabb, Debtor,
  326 B.R. 785 (Bankr.D.Ariz. 06/23/2005)

Arizona Life Insurance

Section 1. Section 20-1131, Arizona Revised Statutes, has been amended.

Life insurance proceeds not to exceed $20,000 are exempt, if payable to surviving spouse or child upon the life of a deceased spouse, parent or legal guardian. [A.R.S. § 33-1126(A)(1)]

Cash surrender value of life insurance policies in an amount not to exceed $25,000 are exempt, where for a continuous unexpired period of two years such policies have been owned by a debtor and have named as beneficiary the debtor’s surviving spouse, child, parent, brother or sister, or any other dependent family member. [A.R.S. § 33-1126(A)(6)]

• Group life insurance policies or proceeds are exempt.

Statute

Arizona IRAs & Pension Plans

• IRAs are exempt.

Statute

See In re Herrscher, 121 B.R. 29 (D. Ariz. 1990).

• ERISA-qualified benefits deposited more than 120 days before filing bankruptcy are exempt. [33-1126(b)]

Statute

• State employee pensions are exempt

Statute

• Police officer’s pensions are exempt.

Statute

• Firefighter’s pensions are exempt.

Statute

Arizona Fraudulent Transfers

For additional detailed information relating to fraudulent transfers, including the text of the Uniform Fraudulent Transfers Act, see fraudulent transfers

Arizona Fraudulent Transfer Act

• Arizona Fraudulent Transfers Act

Arizona Fraudulent Transfer Cases

State Appellate Court

• Elyse Kaufmann v. M & S Unlimited, LLC
  461 Ariz.Adv.Rep. 26 (Ariz. 09/30/2005)

• In re Camilla Jean Strasser, Debtor v. David W. Cavan and Karen Cavan,
  303 B.R. 841 (Ariz. 01/13/2004)

• Moore v. Browning,
  50 P.3d 852 (Ariz.App.Div.2 07/25/2002)

• Bike Fashion Corp. v. Kramer,
  2002.AZ.0000073 (Ariz.App.Div.1 05/16/2002)

• State ex rel Industrial Commission of Arizona v. Wright,
  2002.AZ.0000047 (Ariz.App.Div.1 04/02/2002)

• Hullett v. Cousin,
  2001.AZ.0000167 (Ariz.App.Div.1 10/02/2001)

• Hall v. World Savings and Loan Association,
  943 P.2d 855 (Ariz.App.Div.1 02/27/1997)

• Herstam v. Deloitte & Touche,
  919 P.2d 1381 (Ariz.App.Div.1 04/11/1996)

• Batiza v. Neil P. Superfon,
  857 P.2d 1285 (Ariz.App.Div.2 11/24/1992)

• Wright v. Hills,
  780 P.2d 416 (Ariz.App.Div.2 03/09/1989)

• McElhanon v. Hing,
  728 P.2d 256 (Ariz.App.Div.1 10/01/1985) Civil Conspiracy

• Union Bank v. Pfeffer,
  502 P.2d 535 (Ariz.App.Div.2 11/08/1972)

• Goodman v. Cushman,
  376 P.2d 394 (Ariz. 11/28/1962)

• In re Metheany,
  298 P.2d 804 (Ariz. 06/19/1956)

• Schuster v. Schuster,
  73 P.2d 1345 (Ariz. 12/06/1937)

• Valley Bank and Trust Co. v. Parthum,
  56 P.2d 1342 (Ariz. 04/27/1936)

• Molina v. Bennett,
  289 P. 512 (Ariz. 06/30/1930)

Arizona Trusts

For additional detailed information relating to the use of trusts for asset protection, including foreign and domestic asset protection trusts, see trusts.

Arizona Trust Act

• Uniform Trust Code (14-10101 thru 14-11203)

  Although the Arizona legislature enacted the Uniform Trust Code on January 1, 2004, the legislation has recently been repealed.

Arizona Spendthrift Trust Cases

• In the Matter of the Estate of Juanita M. Ward,
  23 P.3d 108 (Ariz.App. 05/29/2001)

Arizona Business Entities

Arizona Acts

• Arizona Corporation Act
• Arizona Limited Partnership Act
• Arizona Limited Liability Company Act

Arizona Charging Order Statute

• Arizona Charging Order (LLC)

Arizona Charging Order Cases

• In re Ehmann,
  2005 WL 78921 (Bankr.D.Ariz. 01/13/2005)

• Chandler Medical Building Partners v. Chandler Dental Group,
  855 P.2d 787 (Ariz.App.Div.1 05/25/1993)

Arizona Alter Ego & Corporate Veil Cases

• State Compensation Fund v. Yellow Cab of Phoenix,
  3 P.3d 1040 (Ariz.App.Div.1 11/26/1999)

• Taeger v. Catholic Family and Community Services,
  995 P.2d 721 (Ariz.App.Div.1 06/17/1999)

• Horizon Resources Bethany Ltd. v. Cutco Industries Inc.,
  881 P.2d 1177 (Ariz.App.Div.1 05/10/1994)

Useful Arizona Links

For additional detailed information relating to financial frauds and tax scams, see http://www.quatloos.com

• Arizona Secretary of State
• Arizona Attorney General
• Arizona Department of Securities
• Arizona Bar Association

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