Below is a recent question I answered on http://www.avvo.com/. It is a common question of many clients with creditor issues.
Q: does it make sense to purchase/transfer assets in the name of the spouse.: if you are in a profession/job subject to litigation, does acquiring/transferring assets in the name or your spouse keep those assets in the event you are sued. I live and work in the state of Washington.
A: Thomas' answer: Not necessarily. Washington is a community property state. Assets acquired during the marriage are presumed to be community property, which means each spouse has 1/2 interest in the whole. You may rebut the presumption if you can trace the funds used to purchase the asset to a separate property source (i.e. inheritance). But keep in mind, inheritance will only retain its separate character during marriage only if it has not been commingled with community funds. Separate entities such as limited liability companies and certain irrevocable trusts may be a better way to hold title to the assets depending on what assets you are acquiring. Also professionals should probably consider having malpractice insurance as well.
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