Universal Life Policy With Indemnity LTC Rider Owned By An ILIT
BSMG
ILITs,
Long Term Care,
Advanced Sales
No Comments
22 Feb 2018
The use of an indemnity Long Term Care (LTC) rider is crucial to keep the life insurance death benefit estate tax free. That’s because any rider benefits will be paid only to the Irrevocable Life Insurance Trust (ILIT) as policy owner, and NOT used to pay extended care costs directly to the extended care provider. Since LTC benefit claims are paid only to the ILIT, this indemnity style LTC rider does NOT create an incident of ownership in the UL policy.
10 Benefits of a Well Drafted Durable Power of Attorney Document
BSMG
ILITs,
Advanced Sales,
Irrevocable Trust
No Comments
8 Jun 2017
As people age into their 80s, with longer life expectancies, their mental capacity is often diminished. This declining capacity presents an interesting issue which can impact whether continued gifting of premiums to Irrevocable Life Insurance Trusts (ILITs) can take place.
Read MoreUnderstanding the Inherited IRA Legacy Plan
BSMG
ILITs,
IRAs,
Advanced Sales
No Comments
3 Feb 2017
Have you encountered a client, maybe a successful business owner or professional, with more than $1,000,000 in their IRA account? Many of these IRA owners have multiple sources of income as they approach their retirement years.
"Zero-Gift"GRATs and ILITs
BSMG
Annuities,
ILITs
No Comments
14 Apr 2016
A Tax Efficient Capital Transfer Strategy
Using a so-called “Zero-Gift” Grantor Retained Annuity Trust (GRAT) coupled with an Irrevocable Life Insurance Trust (ILIT) can provide estate, gift, and income tax free transfer of estate assets to heirs in an economically efficient manner.
This article, by BSMG's very own Russell E. Towers, takes a look at the long list of GRAT advantages available under current law. As well as a case study on a zero-gift GRAT in tandem with an ILIT.
Read MoreWhat To Do With An ILIT When the Estate Is No Longer Taxable
Russell E. Towers JD, CLU, ChFC
Advanced Markets,
ILITs
2 Comments
21 Oct 2015
Since the federal estate tax exemption is $5.43 million (single) and $10.86 million (married), does paying premiums for life insurance owned by an Irrevocable Life Insurance Trust (ILIT) that was purchased years ago when the estate tax exemption was much lower make sense anymore?
Are there other important retirement and protection needs that could be covered with the annual premium that has been gifted to the ILIT for many years?
A current no-lapse single-life universal life (UL) policy or no-lapse survivorship universal life (SUL) policy may still provide a good internal rate of return (IRR) on death benefit at life expectancy. And the pre-tax equivalent is even better because the life insurance death benefit is income tax free. However, the federal estate tax exemption may have only been between $1,000,000 and $2,000,000 when the trust-owned policy was purchased and it made sense at the time to offset projected estate taxes with estate tax free insurance owned by the ILIT.
Design an IRA Legacy Plan With Life Insurance
Russell E. Towers JD, CLU, ChFC
Life Insurance,
Asset Strategies,
Advanced Markets,
ILITs,
IRAs
No Comments
28 May 2015
The equities market is recovering and it is becoming more common for individuals to have over $1 million in their individual retirement accounts (IRAs). As these individuals are approaching their retirement years they are collecting income from multiple sources such as the owner's job, Social Security retirement benefits, K-1 "pass-through" income from ownership of S-corp or LLC entities, and rental income from real estate.
Read MoreCharitable Remainder Trusts & Wealth Restoration ILITs
Russell E. Towers JD, CLU, ChFC
Advanced Markets,
ILITs
No Comments
21 May 2015
A Beneficial Planning Tandem
The benefits of a charitable remainder trust (CRT) working in tandem with an irrevocable life insurance trust (ILIT) are significant for charitable-minded estate owners looking to benefit a public charity or their own private charitable foundation. How does a CRT work, and what are the valuable benefits it can provide? The CRT can be formed either as a charitable remainder annuity trust (CRAT) which can provide a fixed lifetime income to the donor or as a charitable remainder unitrust (CRUT) which can provide a fixed percentage end of year value lifetime income to the donor.
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