Can the Irrevocable Life Insurance Trust Last Forever
August 10, 2017Depending upon state law, a life insurance trust can last as long as any other trust, including dynasty trusts. If the ILIT is a dynasty-type ILIT, it will be subject to generation-skipping transfer taxes as discussed in Chapter 4. However, your generation skipping transfer tax exemption can be applied against the amount contributed to the… Read more »
What Happens to the an Irrevocable Life Insurance Trust or ILIT When I Die?
August 08, 2017What about my ILIT when I die? At your death, the death benefits are payable to the ILIT, because the ILIT is not only the owner of the policy, it is also the beneficiary. The death benefits are then held and administered by the Trustee according to the ILIT’s specific terms. The trustee can use… Read more »
Can I Only Put Life Insurance in the Trust?
August 04, 2017Is Life Insurance the Only Thing I can Put in My Trust? Yes. Any asset can be placed in the ILIT. Sometimes an income producing asset is placed inside of an ILIT to provide an income stream from which to pay the premiums on the life insurance. This technique eliminates any further gifts by the… Read more »
Trustee of Irrevocable Life Insurance Trust ILIT -How to Choose one?
August 02, 2017Who Serves as Trustee of ILIT or Irrevocable Life Insurance Trust? In any Irrevocable Life Insurance Trust (ILIT) structure, a Trustee is selected. The trustee of irrevocable life insurance trust is the person or institution that is designated to manage and operate the trust. Often, the trustee is a family member or friend of the… Read more »
ILIT Useful for Anything Else Besides Keeping Insurance Proceeds Out of the Estate?
July 31, 2017ILIT Useful in Many Ways An Irrevocable Life Insurance Trust or ILIT is created to own and control a term or permanent life insurance policy or policies while the insured is alive. ILIT is useful to manage and distribute the proceeds that are paid out upon the insured’s death. The parties in an ILIT are… Read more »
How Does an Irrevocable Life Insurance Trust Work?
July 27, 2017Learn the Ways to Make an Irrevocable Life Insurance Trust (ILIT) Work The steps to successfully establishing an Irrevocable Life Insurance Trust or ILIT include the following: Your advisors, including your attorney, help to design and create the ILIT. The trustee of the ILIT applies for an insurance policy on your life, or the lives… Read more »
I Thought My Insurance Agent Told Me That Insurance Proceeds are Tax-Free. Did I Miss Something?
July 25, 2017Are My Insurance Proceeds Tax Free? Life insurance is NOT always tax-free. One of the most common misconceptions about life insurance has to do with its tax status. In virtually all circumstances, life insurance proceeds are income tax free. The premiums were paid with after-tax dollars and the death benefit is not subject to income… Read more »
What is an Irrevocable Life Insurance Trust?
July 21, 2017The Irrevocable Life Insurance Trust What You Need to Know An Irrevocable Life Insurance Trust (ILIT) is probably the most frequently used type of irrevocable trust. It’s an irrevocable trust that you can establish to own a life insurance policy on your life. If you personally own a life insurance policy, the policy proceeds will… Read more »
Are Irrevocable Trusts Somehow More “Powerful” Than a Revocable Trust?
July 19, 2017Is an Irrevocable trusts more powerful than a revocable trust? In general, the only way to obtain tax advantages using a trust is to give up ownership. Irrevocable Trusts require you to give up legal title (ownership) to any property and that can never be changed. Revocable trusts, on the other hand, do not require… Read more »
What is an Irrevocable Trust?
July 17, 2017So, You Want an Irrevocable Trust – What is That? An irrevocable trust is a trust that may not be altered, amended or revoked by the creator of the trust. The reason you may consider creating an irrevocable trust is because all gifts you make to the trust are treated like gifts made to a… Read more »