There are many types of trusts. Some offer control of how and when your assets will be distributed, while others create tax efficiencies. Irrevocable life insurance trusts (ILIT) can do both. An ILIT takes life insurance policies and moves them outside your estate and into your trust.
When you create an ILIT, you designate your trust as the beneficiary of your life insurance policies. The death benefit proceeds will become property of the trust. You determine in advance how those funds will be used. For most people, a spouse, children and favorite charities will be recipients of the funds. You’ll appoint a trustee to manage the ILIT and ensure your wishes will be carried out.
Having an ILIT will not increase your overall estate tax burden. The assets are held outside your estate, so there’s reduced exposure to estate taxes and the possibility of greater wealth transfer to your heirs.
Is an ILIT right for you? Watch this video, then contact us at GCW Capital Group to find out more.