a trust which holds a life insurance policy and in which the grantor completely gives up all rights in the property transferred to the trust and retains no rights to revoke, terminate, or modify the trust in any material way; beneficiaries usually hold Crummey powers that give them withdrawal rights over trust corpus
A trust that cannot be changed or canceled once it is created.
A document that removes the value of your life insurance from your taxable estate. You choose a trustee to make sure the policy premiums are paid and that your beneficiaries receive proceeds at your death.
The irrevocable life insurance trust, sometimes called an "ILIT", is a legal entity separate and apart from the person who creates it (called the "settler"). It is created when the settler irrevocably transfers property (i.e., cash or an existing insurance policy) to a third person called the "trustee" (usually the settlor's spouse, or a family member) who holds that property for the benefit of certain named "beneficiaries" (i.e., the settler's spouse, children, grandchildren, etc.). The ILIT is frequently used in special needs planning situations or estate tax planning situations. (Source www.nolo.com)
This is a trust that owns a life insurance policy on the life of the grantor, and at death the proceeds are held for the grantor's surviving spouse and children. This kind of trust is especially useful to a business owner because it shelters the proceeds of the life insurance from income and estate taxes, and it provides immediate additional funds to the heirs and beneficiaries.
A trust where insurance is the main asset. When you die, the beneficiaries of the trust get the assets or the trustee manages the assets to support these individuals. If done correctly, this is an excellent way to prevent the policy from being included in any estate tax calculation, while still benefiting your loved ones.
A type of irrevocable trust designed to hold life insurance so it will not be taxed in the insured's estate. Intestacy: The state of dying without a will. State law governs who gets the property owned by the deceased person.
An irrevocable life insurance trust is a trust that cannot be changed (revoked) or cancelled once it is established. The trustee owns a policy on the insured's life and the trust is the beneficiary of the insurance proceeds following the insured's death. It lets you reduce or even eliminate estate taxes, so more of your estate can go to your loved ones. It also gives you more control over your insurance policies and the money that is paid from them.
a trust set up to remove life insurance and its death benefits from the taxable base of the deceased in order to avoid estate taxes
By placing insurance in a properly designed ILIT, the death benefit will not be subject to income, estate, gift or penalty tax on the death of the insured. The entire death benefit passes to the heirs. For a large number of people, the proper use of life insurance is the most efficient way to distribute their wealth.
A type of living trust used to avoid the incidents of ownership in a life insurance contract that makes the insurance proceeds taxable under the federal state tax. The basic function of the trust is to own life insurance policies covering the grantor.