Traditionally, an Irrevocable Life Insurance Trust
was a strategy that used life insurance to pay for projected estate taxes upon death.
Historically, management responsibilities of an irrevocable life insurance trust
consisted primarily of sending Crummey notices and paying policy premiums.
BOSTON, May 26, 2011 /PRNewswire/ -- The John Hancock Life Insurance Advanced Markets Group has introduced a JH Solutions module to help clients take advantage of historically low insurance rates and use arbitrage to pay premiums on an Irrevocable Life Insurance Trust
Also, people who use an irrevocable life insurance trust
must by law live three years after assigning the policy in order for the trust to be outside of an estate, Carter said.
It appears that these rules would govern so-called "private" split dollar plans between the insured donor and the donor's irrevocable life insurance trust
, where the "loan" regime is applicable.
I suggested they buy a `second-to-die' life insurance policy," he says, "one that would pay off after both of their deaths, and have the owner create an irrevocable life insurance trust
to avoid estate taxes.
entered into a split-dollar plan (a way to pay for life insurance) for a $3 million second-to-die life insurance policy (on the lives of Joe and his wife) to be owned by an irrevocable life insurance trust
Have you used an irrevocable life insurance trust
to prevent life insurance proceeds
Create a grantor irrevocable life insurance trust
(ILIT) funded with annual exclusion or lifetime exemption gifts.
The technique is similar to that behind an irrevocable life insurance trust
Gifts to an irrevocable life insurance trust
(ILIT) can both reduce the size of the grantor's estate and increase the amount of wealth passing to heirs via the life insurance death benefit, which may significantly exceed the total amount of gifts.
Should an irrevocable life insurance trust
be set up to hold the life insurance and remove it from the taxable estate?