Don’t Let Them Get Your Money! Where to Hide Money from Lawsuits, Creditors, and the IRS

Are you worried that someone might be coming for your money?

Whether it’s a potential lawsuit, or even if it’s the IRS or a creditor, you probably want to protect your assets.

If you want to protect your assets, you need to know where to hide your money, and know how to properly structure certain accounts in order to avoid having someone drain your financial well dry.

Here are some places that you can hide your money:

Retirement Account

One of the best places to hide your money is an ERISA-qualified retirement plan.

Not only can you keep some of your money safe, but you can also earn a tax-advantaged return on the money.  The money in your retirement account is protected from liability lawsuits.  Additionally, your retirement account might have some protection from bankruptcy and creditors (not always, though).

Even the IRS is reluctant to levy against your retirement account.

The IRS does have the ability to access any money that you have access to (so if you can’t withdraw from your account for whatever reason, the IRS can’t require the assets in the account), but in many cases officers are slow to move against your retirement account, even if they could.

Can you hide your money from the IRS?


Transfer of Assets

Consider transferring some of your assets.

One place to hide your money is in a business — just make sure that you set everything up properly.  If you keep assets in your business, they can be protected from liability lawsuits, and they even might be protected from different creditors.

Your can also use your business as a shield for other assets.  Guru Robert Kiyosaki did this not too long ago.  One of his many business declared bankruptcy as a result of a lawsuit, but that business only represented a small fraction of his assets.  His personal fortune remained unaffected.

You can transfer ownerships of your assets to someone else, or even transfer ownership to a trust.  That way, you no longer own the assets, and it is harder for others to come after your money.

The Use of Trusts


If you really want to figure out where to hide your money, you can make use of certain types of trusts.

You can use different asset protection trusts to help you protect your money from lawsuits, creditors, and even from the IRS.  However, if you hide your money in a trust, you need to be aware of some of the downsides.

First of all, the kind of trust that is most likely to protect your assets is an irrevocable trust.  Now, you no longer own the assets; the trust does.  The trust can use the money for the benefit of your beneficiaries (including yourself).  However, you lose a measure of control over your money when you put it in a trust like this.  The reason that your money is protected to some degree — aside from the fact that it is no longer technically yours — is that you don’t have ready access to it in many cases.  Even with the IRS, the rule is that you have to be able to access your money.  If you can’t get at it, neither can the IRS.  Of course, the downside to this setup is that you don’t always have the right to access your own money.

Be Careful of How You Proceed

As always, you need to be careful of how you proceed.  Whether you are organizing a business, setting up a trust, or transferring assets in some other way, you should consult a knowledgeable estate planner or attorney.  Make sure you understand the process, as well as the restrictions related to your money.

Also, realize that putting all of your money into these types of accounts as a response to an impending problem is not an acceptable solution.

Creating a trust after the creditors come calling, or after you are served with a lawsuit, can negate the effects of the operation.  You need to be making asset transfers and retirement contributions before someone comes after your assets.  Figuring out where to hide your money is more about long-term planning and asset protection than it is about stop-gap measures when an emergency presents itself.

Have you ever had to hide your money? How did you do it?

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Published or updated March 6, 2015.


  1. In general, this sort of thing leaves a bad taste in my mouth. Just pay what you owe.

    That said, my in-laws lost their house and had to move in with us. They were living on my MIL’s disability: $1,100 a month. Yet they were still making payments on their credit card and keeping their cell phone! I told them to knock it off. So what if they’re hit with an early termination fee? Their income is protected from creditors.

    • You are cruel. They raised your husband or else he wouldn’t have been available to be your husband in the 1st place. They deserve ABSOLUTE RESPECT & plenty allowances! If it strains your budget, get a 2nd job or a work-at-home side business online. But always respect your elders even IF it hurts! ALWAYS.

  2. I agree most people are in debt because they choose not to change their lifestyles. If you are in debt and have a negative cash flow every month you need professional help, that’s the bottom line.

    • Yes, including you MR. Moore, everyone in the world needs financial education & advice. Sadly though, you voted for a government official that supports not offering financial management in today’s schools. So guess when you’re 80+ you should expect to see immense, widespread poverty.

  3. The problem as presented is, as working folk your at a disadvantage and being preyed upon by the irs whereas people with money pay insignificant amounts 14% and lower if any at all!
    whereas the working class has no access to the deductions loopholes etc etc.
    working class people pay 27% and upward and still have to pay some one else to figure and file the return. The other problem is where you take your taxes to be figured the person doing them gets paid by how many returns he files. So again you get taken by the system. The fear the IRS holds over us is criminal. their freehand at dealing out punishment without providing constititional rights and redress is un-american…

    • RIGHTY-‘O, there Don!
      You hit one of the biggest problems with a ‘Capitalistic Monetary System’ on its [nail] head! The other issues are equally as biased. So then ponder this dear reader: Why on earth do we even remain in such a country. Because no matter where you go this wrongful system.has been transplanted, instilled, integrated & is equally raging in most other countries (especially wherever Caucasians (Whites) love to congregate. Take a good look at development of Panama Canal, Guadalajara, Philippines, etc. All once beautiful, UNSPOILED, areas where living was natural, healthy, low cost and ideal. Now each is another cess pool of extremely high costs, unhealthy air & environment & barely anything left is natural except for decorative landscaping. Hah! So where are the wealthy [& privileged] going now: ISLANDS. Yes, their last stand to be as far away as possible but still be close to their financial investments. To claim U.S. citizenship but technically NOT LIVE amongst the muck & mire.

      Whether or not you choose to remain in the U.S. is not the issue, but where you stash your $ is.

  4. Read and understand any contracts yourself before you sign them. Make sure you understand the consequences of any default. Many banks, financial institutions and creditors will have clauses in their contracts which are way beyond the limits of the current contract. Consider the risks and look at the downsides. Be especially careful when signing personal sureties as they can have very serious negative consequences.
    Remember that the deck is heavily stacked in their favor and you must do whatever possible to protect yourself.
    As a last resort communicate and negotiate.

  5. I enjoyed the article. These are some good tips. Being proactive and changing your lifestyle and paying your taxes would go a long way to preventing this kind of situation in the first place.

    Just my thoughts.
    Thanks for the informative post!

    Laura Beth

    • Dear sweet, ‘pre-conditioned thinker’ (taught by wonderful parents & know no other independent thought due to lack of life experiences yet to come) Laura Beth, doing what APPEARS OR SEEMS TO BE RIGHT in a capitalistic system based on greed and benefitting the privileged IS NOT always best for every individual [especially the UNDER-privileged]. Hopefully, after a excellent course in Economics you will come to see this as you age, my dear. Meanwhile, hoping you have a fantastic & secure life.

  6. Kevin McMillan says:

    I get agree when someone says read the fine print and the duh, but it is great advice. I get irritated when someone says pay your bills, you created them you owe them! Those people don’t always know the circumstances even though they know everything! What if that person was injured on the job, the workers comp. Claim was denied, savings exhausted, interested and late fees piled up, the financial institutions only wait so long! It took 2 years to open my claim!

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