Nevertheless, the contempt cases make Rothschild cautious about going offshore with a client who has not been sued but who may have some clouds brewing on the horizon. The client can still set up an asset protection trust, provided he retains enough wealth outside it to cover the foreseeable claims. However, if an American court later determines that he failed to do that, "that's where the risk of contempt is greatest," Rothschild says. Therefore, in such situations it may be wiser to utilize a domestic trust even if the client is in a non-APT state. Staying within the bounds of the U.S. legal system and its appeals process obviates the need for the bench to threaten contempt and incarceration.

Given what's at stake, it's obviously important to work with a knowledgeable attorney. Yet you also want one who doesn't prey on the client fears that give birth to these vehicles in the first place. Says Osborne in Austin, "Rather than playing up the emotional side, the attorney should help the client think about these trusts rationally." The advisor has a role to play there, too.