There are literally hundreds or even thousands of variations on the theme, but most entities and strategies conceptually, at least, fall within one of these firewall types. For example, limited liability partnerships (LLPs) and limited liability limited partnerships (LLLPs) are variations on limited partnerships.

Neither does every possible firewall fall within one category or another. For example, exposed cash may be used to buy a deferred annuity that will create an income stream many years hence. While the annuity payment may theoretically be claimable by the creditor (assuming its ownership falls under a jurisdiction that does not exempt such payments), how much is it worth to a creditor who must wait years to collect?

Although this book is comprehensive in that it examines all major protective strategies, as well as some highly effective yet lesser-known strategies, we don’t aim to survey every nook and cranny of the asset protection world.

The best defense is a good offense. This truism applies to asset protection as well as to other conflicts. There are a number of ways to impose liability on a creditor who attempts to seize assets. For instance, a creditor who obtains a charging order (which may include foreclosing on the order) on a limited partnership or LLC interest may incur a tax liability while receiving nothing from the entity with which to pay the tax. Or, a creditor who wishes to commence litigation against a Nevis entity may be forced to pay a $25,000 bond before they can do so. There are any number of liability- imposing features that act as quills on the porcupine. It makes pursuit that much less attractive.

Seldom do the counter-offensive capabilities of a particular strategy control its adoption, but they may influence it. The goal is to present the creditor with a downside to pursuing the asset. In a nutshell, defense-in-depth and diversification strategies discourage a creditor from chasing assets by making the chase more difficult and the outcome uncertain, while counter-offensive strategies may make a creditor financially worse-off than if he had not attempted collection in the first place.