THE IRREVOCABLE LIFE INSURANCE PRESERVATION TRUST HANDBOOK

Save this PDF as:
 WORD  PNG  TXT  JPG

Size: px
Start display at page:

Download "THE IRREVOCABLE LIFE INSURANCE PRESERVATION TRUST HANDBOOK"

Transcription

1 THE IRREVOCABLE LIFE INSURANCE PRESERVATION TRUST HANDBOOK This handbook is not to be used in lieu of appropriate legal advice. INSURANCE PRESERVATION TRUST HANDBOOK Page 1

2 IRREVOCABLE INSURANCE TRUST (THE PRESERVATION TRUST) A life insurance trust is an irrevocable, non-amendable trust which is both the owner and beneficiary of one or more life insurance policies. Upon the death of the insured, the Trustee invests the insurance proceeds and administers the trust for one or more beneficiaries. If the trust owns insurance on the life of a married person, the non-insured spouse or children are often beneficiaries of the insurance trust. If the trust owns "second to die" or survivorship insurance which only pays when both spouses are deceased, only the children would be beneficiaries of the insurance trust. Since the trustee of the insurance trust possesses all incidents of ownership in the insurance policy, the insurance trust provides the insured's estate with liquidity while shielding the insurance proceeds or assets purchased with the proceeds from estate tax when the insured dies, provided the trust has the appropriate Trustor and trustee. OWNERSHIP OF INSURANCE Proper ownership of life insurance is important if the insurance proceeds are to escape federal estate taxation. If the policy is owned by the insured, the proceeds will be subject to estate tax. (This assumes that the aggregate value of the estate plus the life insurance is large enough to be subject to estate taxes.) To avoid estate taxation, some insureds name a child, spouse or other beneficiary as the owner of the policy. There are, however, several drawbacks to having insurance owned by and the proceeds paid outright to a child, spouse or other beneficiary. o Recordkeeping each child must have check made to him/her, then must be relied upon to make the premium payment on time. o It is also an asset of the child so is subject to divorce, lawsuits, liens, debts. It s wiser to put in an Insurance Trust. o The IRS views the monetary gift to the kids as a gift of future interest and all future premiums and cash value will offset the Trustor s Federal Estate Tax exclusion at death. o Also, the IRS is not specifying whether the interest of each beneficiary is by percent of ownership or joint owner, which can create other issues. Furthermore, the IRS requires an annual gift tax return based on current cash value plus future premiums paid into the policy. o With an ILIT, the annual allowable gift is considered by the IRS a gift of present interest. Therefore, the current $13,000 allowable gift does not require a gift tax return, and does not offset the Federal Estate Tax exclusion of the client. Therefore, the ILIT is a safer vehicle because it allows for the beneficiaries to exercise the options in the Crummey letter. The solution to the drawbacks is usually an irrevocable life insurance trust. INSURANCE PRESERVATION TRUST HANDBOOK Page 2

3 When possible, the trustee of the insurance trust should be the original applicant and owner of the insurance. If the insured transfers an existing policy to the insurance trust, the transfer will be recognized by the Internal Revenue Service only if the insured survives the date of the transfer by not less than three years. IRC If the insured dies within this three year period, the transfer will be ignored and the proceeds will be included in the insured's taxable estate. Insurance trusts may be funded or nonfunded. A funded life insurance trust owns income producing assets, i.e. has cash value. The income may be used to pay some or all of the premiums. But funding insurance trusts with existing policies with cash value are not commonly used for two reasons: 1. The additional gift tax cost of transferring the cash value to the trust, and 2. The grantor trust rules of IRC 674(a)(3) which cause the Trustor to be taxed on the trust s income. So, usually a client will establish a trust with new policies. The premiums are funded by annual gifts from the Trustor. Each Trustor has the right to gift annually up to $13,000 gift tax free to each beneficiary, and this is used to pay premiums, but not have them taxed as a gift. WHAT ARE THE MECHANICS? Transfer/Establish Policies. The transfer or placement of an insurance policy is an "Irrevocable Assignment." In other words, the trust should be named as the new "owner" of the policy, as well as the new beneficiary. It is not sufficient to merely designate this trust as the beneficiary, you must designate ownership. Send Notification letters. Notification letters need to be sent to each beneficiary when the policy is transferred to the trust. Each time a premium payment is made through the trust, the trustees also need to send notification letters to each of the beneficiaries, including any minors. A sample copy of the standard notification letters, as well as a notification to guardian letter, is at the back of this article, as well as precise explanation of Trustee duties and how to manage the trust. Make the Premium Payment. With respect to the premium payment procedure, it is best if the client pays the premium amount to the trustees who will then deposit it to a trust bank account. This payment should be made as soon as the premium bill comes in. The trustee will then send out the notification letters and, on the due date of the premium, they should pay the premium from the trust's checking account to the insurance company. Gift Tax. Sending the notification letters to the beneficiaries is very important from a gift tax standpoint. The $13,000 per donee gift tax exclusion applies only if these notification letters are properly sent each time a premium contribution is made to the trust, or a policy is transferred into the trust. Your trustees should keep a file containing all of the notification letters in it. INSURANCE PRESERVATION TRUST HANDBOOK Page 3

4 Tax Returns. Finally, the transfer of the policies to the trust (and perhaps the annual premium payments) may require the filing of a gift tax return. To reduce the value of the policy to a lesser level to avoid or reduce the gift tax consequences, you may want to borrow against the policy before transferring it to the trust if it has any cash value. Even if a gift tax return is not required, you may wish to file one anyway in order to make important generation skipping transfer tax elections. Generally, any such generation skipping transfer tax elections with respect to a term policy are deferred until you die, but with respect to a whole life policy or a policy for which there is a whole life component, it is desirable to make the generation skipping transfer tax elections now. SETTING UP A TRUST The first steps are to determine the Trustee, the "Crummey" beneficiaries, and the time period for the withdrawal right (our trust sets it at 30 days). When the final document has been prepared, the insured and the trustee both must sign the trust agreement, and each should keep a copy. The insured provides the trustee with names and addresses for the "Crummey" beneficiaries named in the trust. In most cases, new policies are issued to fund the trust usually second to die policies with married couples, though any type can be placed in the Preservation Trust including group policies IF the Trustor has the right to change ownership. The trustee is named as both initial owner and beneficiary. If the insured has existing policies which are to be transferred (as gifts) to the trust, then he must file absolute (i.e., irrevocable) assignment forms with the insurance company which designate the trustee as owner and beneficiary. The life underwriter generally assumes responsibility in this situation. After the assignments have been accepted by the insurance company, copies should be provided to both the insured and the trustee. It is recommended that the trustee keep the original insurance policies and endorsements with his or her important papers. Copies can be provided for the insured. The insurance company should be instructed to send all notices of premium payments directly to the trustee, with a copy to the insured. At this point, the initial steps to transfer the policies have been taken, the trustee has a signed copy of the trust document and has been provided with the addresses of the "Crummey" beneficiaries. There are a number of things which must be done next: 1. Open a bank account for the trust. The trustee must write checks to pay the insurance premiums so a checking account is required. In most cases, the premium deposits will be in this account for only a few weeks, so a non interest bearing account will simplify tax matters. There will then be no interest income to require the filing of an income tax return for the trust. The account should be titled "[name of Trustee], Trustee for the [name of Settlor] Preservation Trust dated [date trust signed]." INSURANCE PRESERVATION TRUST HANDBOOK Page 4

5 2. Obtain a Tax ID number from the IRS using form SS-4. The insurance companies and the bank will require a Federal Tax Identification Number (TIN) for the trust. 3. Insured issues check. If new insurance policies are being purchased for the trust, the insured will deliver a check for the initial premium to the trustee. The trustee immediately deposits this check in the trust's bank account and sends notice of this contribution to each of the "Crummey" beneficiaries. Further discussion of the contents of this letter notice and a sample form will be found later under Maintenance of the Trust. 4. Obtain IRS Form 712, Life Insurance Statement, for each existing policy which is assigned to the trust. The insurance company will provide this. The statement provides the net value of the policy for gift or estate tax purposes. If the value of policies given to the trust in any one year exceeds $13, times the number of "Crummey" beneficiaries, then a federal gift tax return must be filed. This is not necessary for new policies. Although not required to do so, a gift tax return may be advisable to toll the statute of limitations or to make certain generation skipping transfer tax elections. 5. The "Crummey" beneficiaries must be given notice of the new trust and their rights under the trust. This letter should be sent immediately after the insurance policies are purchased (this is when the first premium is paid to the trustee) or assigned to the trust by the insured. The trustee should send a photocopy of all letters to the insured and keep a copy for his/her records. If existing policies are assigned to the trust, the "Crummey" beneficiaries will have a right to withdraw from the cash value of the policies. 6. The trustee should maintain a ledger to record receipts of premium deposits and payments of insurance premiums or interest. 7. The trustee should establish and maintain a permanent file to preserve important trust documents. The suggested items to be placed in the file include: o A signed copy of the Trust Agreement; o Assignments of insurance policies to the trustee and IRS Form 712 (only for old policies transferred to the trust); o Names and addresses of "Crummey" beneficiaries; o Federal Employer Identification Number; and o Copies of all notice letters sent to "Crummey" beneficiaries. MAINTENANCE OF THE TRUST Trust maintenance consists of collecting premium deposits, paying the insurance premiums, and mailing notices of right of withdrawal to the "Crummey" beneficiaries. Other decisions or policy transactions can result in additional responsibilities. For example, if the policy premiums are "vanished" after a number of years, paid up additions may need to be surrendered in subsequent years. Once the Trust has been established, the trustee's duties will include the following: 1. Collect Premiums. The insurance company will send the premium notice to the trustee as owner of the policy. The trustee must immediately forward a copy of the notice to the insured with a request that the insured forward funds to pay the premium and/or interest INSURANCE PRESERVATION TRUST HANDBOOK Page 5

6 due to the trustee. The trustee should keep a copy for his/her records. The insured's payment must reach the trustee in time to allow for passage of the withdrawal period before the trustee pays the premium before the due date to the insurance company. Two things are important. First, the insured, with the help of his or her insurance advisor, determines the amount to be paid. He may pay the full premium, interest only, or there may be no payment at all if the premium is to be borrowed from a loan under the policy. If the insured is not making a payment, he should notify the trustee what is to happen so the trustee will know the policy will not lapse without the payment. Second, the insured must consider that the trustee must hold the premium funds for the withdrawal period before the premium are paid so the funds must be received early enough to avoid lapsing of the policy. The insured sends funds to pay the premium and/or interest due on the policy to the trustee. A few extra dollars should be included to cover any charges for the trust bank account. The insured's check should be payable to "[name of trustee], Trustee". It is again emphasized that the insured must send the funds to the trustee so the withdrawal period can expire before the trustee pays the premium to the insurance company. One way to take care of this is to enlist the cooperation of an insurance agent. The agent can give the insured annual notice that the premium is coming due and can do this far enough in advance to ensure a timely deposit. He or she will also have records to remind the insured of the amount due. In some cases it may be difficult or impossible to collect the premiums and allow the required notice period to pass. Some methods to deal with this situation are discussed below. Immediately upon receipt, the trustee must deposit the insured's contribution to the trust's bank account. The deposit is entered in the ledger page for the trust as a receipt from the insured. 2. "Crummey" Beneficiary Notices. The Trust Agreement gives the beneficiaries the opportunity to send the trustee a request to withdraw a proportionate share of each contribution made to the trust by the insured. This applies only to contributions and would not, for example, apply to dividends received from the insurance company or to premiums paid by surrendering of additions after the premium has "vanished". This right to withdraw lasts for a time period specified by the trust agreement (usually 30 days). So, upon receipt of each contribution to the trust from the insured, the trustee must promptly notify each "Crummey" beneficiary that a deposit has been made with the right to withdraw. This is done by sending a letter to each beneficiary stating the amount that has been contributed to the trust, the period during which the request for withdrawal must be made, instructions for determining the amount subject to withdrawal, and how the trustee is to be notified if a withdrawal is requested. Copies of this letter should be sent to the insured for his or her permanent records and the trustee should also retain a copy. In the case of a minor beneficiary, notice should be sent to the non-insured parent or guardian of the minor. The 30-day withdrawal period begins to run when the notice letters are mailed. The insurance premiums should not be paid until the 30-day withdrawal period has passed. So we again emphasize that the trustee must act promptly to collect the premium and send the notification letters. INSURANCE PRESERVATION TRUST HANDBOOK Page 6

7 As stated previously, the premium cannot be paid until the withdrawal period has terminated. There are exceptions to every rule, including this one. A time may come when the check is delayed in the mail or the insured is on vacation when the premium comes due. The trustee's first priority is to pay the premium on time, even if the withdrawal period is not complete. Most policies provide limited grace period to pay the premium, but you must never exceed this. It is the insured's responsibility to get the premium to the trustee with time for the withdrawal period to pass. If he/she fails to do this, then the trustee must pay the premium on time and let the insured deal with any adverse tax consequences that may arise from a shortened withdrawal period. There is one way to avoid the problem of late premium deposits which do not permit a proper withdrawal period. First, while there is no authority directly on point, it would appear that as long as there are cash values in the policies sufficient to satisfy or pay any potential withdrawal request, then a cash equivalent is available to the trustee to pay the withdrawal request and the technique will remain viable. 3. "Crummey" Beneficiary Requests for Withdrawal. In the event that a "Crummey" beneficiary requests a withdrawal from the trust, the trustee must send the amount requested (up to the maximum permitted by the Trust Agreement) to the requesting beneficiary. Only beneficiaries who send written requests during the withdrawal period are permitted to withdraw from the trust. All requests for withdrawals should immediately be reported to the insured. The insured will want to be certain that the requesting beneficiary understands the purpose of the trust. If the withdrawal request is not withdrawn by the beneficiary, then the amount requested, up to the limit specified by the trust, must be sent to the requesting beneficiary. This amount will generally be a portion of the insured's contribution to the trust. Now the funds in the trust probably will be insufficient to pay the premium due on the insurance policy. (This is why "Crummey" beneficiaries should not request withdrawals from premium deposits to the trust -- they jeopardize their interest in the death benefits if the policy lapses). In such a case the insured may have to make another contribution to the trust to replace the withdrawal. New notice letters must be sent to the "Crummey" beneficiaries for any additional deposit by the insured. If it appears that the beneficiary will again request a withdrawal, the insured may wish to exercise his or her power to designate the gift "recipients" under the trust and exclude this beneficiary. 4. Pay Premiums. Following the passage of the withdrawal period, the trustee writes a check on the trust bank account to the life insurance company to pay the premium or interest due on the policy. The trustee should keep a copy of the premium notice for the trust's records and mark the copy of the premium notice with the date and check number of the payment. Retaining the canceled check in the file is also helpful. The trustee sends the premium check and premium notice to the insurance company. The trustee must wait for the withdrawal period to pass before paying the premium unless arrangements have been made as discussed in number three, above. INSURANCE PRESERVATION TRUST HANDBOOK Page 7

8 ***Premiums must be paid before the end of the grace period to ensure that the policy does not lapse.*** 5. Bookkeeping. The trustee enters the premium or interest payment in the ledger page as a withdrawal from the trust, balances the trust checking account, and verifies that the balance in the bank account agrees with the ledger page. This is the procedure which the trustee must follow for each premium on life insurance policies held by the trust. In the event that the insured has multiple policies in the trust, he may elect to make one or two deposits to the trust during the year to pay all premiums. If the insured wants to make one large deposit to cover several policy premiums, his insurance agent should be able to estimate the total required to cover the premiums or interest. A reminder, the trustee should send notices to the "Crummey" beneficiaries for each deposit made by the insured. The first gift to the trust in each year should be at least $5,000 per "Crummey" beneficiary, or if less, the full annual premium. End of Year Trustee Services In December of each year, the trustee must bring his records up to date and send a report of trust activities to the insured. The steps are to: Taxes 1. Balance trust account ledger page. Notify insured of any balance remaining in the trust account which may be used for next year's payments. 2. Balance trust check book. This balance should agree with the balance on the ledger page after adjustment for checking account fees. 3. Send a copy of all life insurance premium, interest or dividend notices to the insured. Indicate on each form the amount which has been paid. The insured can use these figures to determine the amount of deposit which will be required to pay the interest or premiums on the policies in the coming year. It is a good idea to send the insured a copy of the trust ledger page as a record of the status of the account. 4. Bill for Trustee Services. If the trustee is charging for services, send a bill to the insured for next year's services. 5. Permanent Records maintained. In the permanent file which is kept, place the following items: Copies of notice letters sent to "Crummey" beneficiaries. Copies of insurance premium notices. The trust ledger page. Copies of any tax returns. Copies of other correspondence. Generally, there will be no income tax returns to file or taxes to pay by the trustee if the accounts are non-interest bearing. 1. A Gift Tax Return, Form 709 needs to be filed each year that a gift is made. The client must discuss this with their CPA or tax advisor whether the GST exemption should be allocated to this Trust. INSURANCE PRESERVATION TRUST HANDBOOK Page 8

9 2. Other. The trustee will periodically receive correspondence from the insurance company with information on the status of the policy or offers to modify various policy features. These can be forwarded to the insured for his or her input or suggestions, but it is up to the trustee to make the decision as to what, if any, action to take. INSTRUCTIONS FOR SPECIAL SITUATIONS WHICH MAY OCCUR Interest and Dividends If the insured has borrowed on any policy held by the trust, there will be interest payments due on the loan. Interest bills should be treated in the same manner as premiums. The insured will deposit the interest amount due with the trustee. The trustee notifies the "Crummey" beneficiaries of the deposit of interest or premiums and then pays the interest or premium as directed by the insured. If the insured does not know what to pay, he should contact his agent. A whole life policy earns dividends after the first year. In many cases the dividends will be credited to the premium, reducing the amount which will be due from the insured. Dividends which reduce policy premiums are not considered deposits by the insured and there is no requirement to send notices to "Crummey" beneficiaries. With some older policies, the dividend may be greater than the premium amount. Depending on the dividend option, the excess dividend may then be paid to the trustee by the insurance company. If so, the trustee will deposit the dividend to the trust bank account. Since the dividend is paid by the insurance company and not the insured, there is no requirement to send notices to the "Crummey" beneficiaries. Dividends which have been deposited to the trust account may be used to pay premiums or interest on the insured's other policies. If there are no other policies, then the dividends will accumulate in the trust's bank account. Policy Loans Most whole life insurance policies accumulate a cash value as they get older. The policy and trust provisions will generally permit the person appointed by the insured to borrow from this cash value. The trust agreement specifies that the trustee may loan money to the spouse or the estate of the insured. This should not be the insured or the trustee. To borrow from the policy cash value, the individual requesting the loan will send a signed and dated request to borrow to the trustee specifying the amount to be borrowed and the policy to be borrowed from if there is more than one, and should indicate how the trustee is to disburse the borrowed funds. All actions are subject to the terms of the Trust Agreement. When the trustee receives instructions to borrow, he/she should consult the Trust Agreement to be certain that the person requesting the loan is authorized; that the amount is proper; and that disbursement is requested to persons authorized to be recipients. INSURANCE PRESERVATION TRUST HANDBOOK Page 9

10 Upon receipt of these instructions, the trustee must ask the insurance company for forms and instructions to borrow from the policy. The trustee will complete the loan forms and return them to the insurance company. The company issues its check for the requested amount payable to the trustee and the trustee deposits this check to the trust bank account. Notices are not required to be sent to the "Crummey" beneficiaries for this deposit. When the insurance company's check has cleared, the trustee can then issue a trust check for the amount of the loan proceeds payable to the trust beneficiaries. The trustee should keep copies of all loan documents and requests in his files and record the transaction in the trust ledger page. Future premium notices for this policy will include interest payments for the amount borrowed. The trustee will collect the funds to pay interest from the insured in the same manner as premiums are collected. The insurance company or agent can provide an estimate of the interest amount which will be payable each year so the insured can be certain to deposit sufficient funds to cover both the interest and premium due on each policy in the trust. The "Crummey" beneficiaries have a right to withdraw from all payments the insured makes to the trust, whether for premium or interest. So the trustee is required to send notices to the "Crummey" beneficiaries for deposits to pay interest and otherwise treat them in the same manner as premium deposits. Taxes The Trust is designed so that the trust will not have any income tax consequences in and of itself. Because the trust does not generate any income, it will not be required to file tax returns or pay taxes. It is suggested the trustee use a non interest bearing checking account for the trust to avoid income (the interest would be minimal in any event). So in most cases the trustee will not be required to file any tax returns for the trust that has been described. There would be an exception to this if the trustee has used a checking account which pays interest. In that event, a fiduciary income tax return, IRS Form 1041 and the equivalent state return, may have to be filed by the trust. A consultation with a tax advisor may be in order if there are further questions. If the trust does not file a return, the trustee may receive a notice from the IRS requesting information about the IRS Form 1041 which was not filed. Since the trust is not required to file this return if there is no income, the form should be completed and, in the remarks section, include: "No return is required because this trust is not a tax-paying entity pursuant to IRC 671." GLOSSARY Insured. The life insurance policies which are assigned to the trust (or purchased by the trust) insure the life of the "insured". The insured is the individual whose life is protected by the policies of insurance which have been placed in the trust. The insured may also be the settlor or grantor of the trust. INSURANCE PRESERVATION TRUST HANDBOOK Page 10

11 Trustor/Settlor/Grantor. The Trustor is the person who is establishing or setting up this life insurance trust. In many cases the Trustor will also be the insured under the policies. Trustee. The Trustee is the individual or organization that is designated in the trust agreement to own the life insurance policies in trust and carry out the terms of the trust agreement. Generally, the sole asset of the trust will be insurance policies on the life of the insured. It is most important that the trustee faithfully perform his or her duties in order to ensure that the policies are kept inforce so the death benefits will be available to supplement the estate of the insured at the time of his or her death. "Crummey" Beneficiaries. Anyone who is entitled to receive benefits from the trust is a beneficiary. The "Crummey" beneficiaries are those individuals who are entitled to benefits during the years in which premiums are paid to the trust during the lifetime of the insured. The name "Crummey" comes from a court case known as Crummey v. Commissioner of IRS, which confirms the gift tax savings and advantages available to this type of life insurance trust. The insured should provide the names and addresses of the "Crummey" beneficiaries to the Trustee. Any notice that needs to be sent to a minor may be sent to the child's parent who is not the insured. These letters should be sent via certified mail and the return card should be kept in the Trust files. INSURANCE PRESERVATION TRUST HANDBOOK Page 11

12 SAMPLE FORMS and TASK LIST INSURANCE PRESERVATION TRUST TASK LIST After Signing the Insurance Preservation Trust, Perform the Following Tasks 1. Tax Identification Number Contact the IRS at to request an Employer Identification Number (EIN) to be used as the Trust I.D. number. 2. Notify Beneficiary(ies) Use the "Notice to Beneficiary of Preservation Trust" letter to notify each individual that is named as a Beneficiary of the Trust. 3. Checking Account Establish a non-interest-bearing checking account for the Trust. The account should be established at a bank that is convenient to the Trustee and at least 40 days prior to the first premium becoming due. 4. Annual Gifts A. The Trustor will make one check for each Beneficiary payable to the Trustee (Example: make checks payable to Robert Smith, Trustee, The Smith Preservation Trust). B. Upon receipt of the funds, the Trustee will send the "Notice to Beneficiary of Gift - First Year" letter to each Beneficiary. (Use the "Notice to Beneficiary of Gift - Second Year & Thereafter" letter for future gifts.) C. The Trustee should deposit the checks into the Trust's bank account. D. Each Beneficiary should use the bottom of the letter to reply to notify the Trustee that he/she received the notice of the withdrawal right, has refused to withdraw, and date it, and return it. E. After the 30 days specified in the aforementioned letter has lapsed, the Trustee should write a check from the Trust's bank account to the life insurance company for the amount of the premium. This amount should be slightly different from the amount of the total gifts. 5. Repeat Procedure Repeat step four each year for gifting money, notifying the beneficiaries and paying the insurance premiums. 6. File Gift Tax Return File Gift Tax Return, Form 709 each year that a gift is made. The client must discuss with their CPA or tax advisor whether GST exemption should be allocated to this Trust. INSURANCE PRESERVATION TRUST HANDBOOK Page 12

13 NOTICE TO BENEFICIARY OF INSURANCE PRESERVATION TRUST, Re: Doe Insurance Preservation Trust Dear : It is my privilege to inform you that you have been designated as a Beneficiary (or guardian of, who is a beneficiary) of the Doe Insurance Preservation Trust. I have attached the instrument for your files. You are entitled to withdraw a portion of the additions to the corpus of the Trust in an amount equal to your pro rata share of %, up to a maximum of $ per year. It is anticipated that gifts of cash or other assets will be made periodically during the year. Without the necessity of further notification to you, the Trustee will make available these funds upon your written request. As and when a gift is made, the Trustee will honor your previously submitted request. Since this Trust provides significant tax and income benefits to you, I urge that you study it carefully. I will be pleased to answer any questions that you or your tax advisor may have. Very truly yours, By:, Trustee (Send via Certified Mail, Return Receipt Requested) INSURANCE PRESERVATION TRUST HANDBOOK Page 13

14 NOTICE TO BENEFICIARY OF GIFT - FIRST GIFT, Re: The Doe Insurance Preservation Trust Dear : Please be advised that $ has been added to the Doe Insurance Preservation Trust (the "Trust") and that you are entitled to withdraw $ from the Trust by written notice to the undersigned within thirty (30) days of the date of this Notice. If you do not exercise your right by the end of that thirty (30) day period, all or a portion of your right shall thereupon lapse and you shall forever cease to have any further right of withdrawal with respect to that addition. In lieu of a withdrawal of cash, you may withdraw Trust property equal in value at the date of withdrawal to the amount of cash you are otherwise entitled to withdraw pursuant to this Notice. This right to withdraw Trust property in kind shall include the right to withdraw insurance policies at their value at the date of withdrawal. Very truly yours, BENEFICIARY ACKNOWLEDGMENT By:, Trustee I,, hereby acknowledge receipt of the foregoing Notice to Beneficiary. I also acknowledge my thirty (30) day right to withdraw my share of the gift. I wish to decline to exercise my right to withdraw my pro rata share. Signed: Dated: OR I,, hereby acknowledge receipt of the foregoing Notice to Beneficiary. I also acknowledge my thirty (30) day right to withdraw my share of the gift. I wish to exercise my right to withdraw my pro rata share and request payment to me of the above mentioned gift this day of,. Signed: Dated: (Send via Certified Mail, Return Receipt Requested) INSURANCE PRESERVATION TRUST HANDBOOK Page 14

15 NOTICE TO BENEFICIARY OF GIFT - SECOND GIFT & THEREAFTER, Re: The Doe Insurance Preservation Trust Dear : This letter is to notify you that a gift has been made to the Doe Insurance Preservation Trust. Under the terms of the Trust, you have thirty (30) days from the receipt of this letter to withdraw from the Trust, in kind or in cash, an amount equal to your pro rata share % of each and every gift, as determined by you, up to the amount of $ per Donor. This being the maximum amount for each separate contribution to the Trust made by a different individual. To the extent that you do not exercise this withdrawal right within the above mentioned time period, it shall lapse and you shall have no further right to withdraw it from the Trust. Sign the appropriate statement below to indicate your intentions and return it to me. If I do not receive it within the above mentioned thirty (30) day period it shall lapse as stated above. Very truly yours, BENEFICIARY ACKNOWLEDGMENT By:, Trustee I,, hereby acknowledge receipt of the foregoing Notice to Beneficiary. I also acknowledge my thirty (30) day right to withdraw my share of the gift. I wish to decline to exercise my right to withdraw my pro rata share. Signed: Dated: OR I,, hereby acknowledge receipt of the foregoing Notice to Beneficiary. I also acknowledge my thirty (30) day right to withdraw my share of the gift. I wish to exercise my right to withdraw my pro rata share and request payment to me of the above mentioned gift this day of,. Signed: Dated: (Send via Certified Mail, Return Receipt Requested) INSURANCE PRESERVATION TRUST HANDBOOK Page 15

16 Sample Letter to Parent/Guardian of Minor Beneficiary [date] [address] Re: The Doe Insurance Preservation Trust Dear : We are enclosing a copy of a letter sent to today informing him/her of his/her withdrawal rights under the Doe Insurance Preservation Trust dated. You, as his/her guardian, can exercise his/her power of withdrawal if you so desire by following the instructions explained in his/her letter. Sincerely yours, Enclosure This memorandum is intended to provide general information regarding tax laws applicable to insurance trusts. It is not intended as a substitute for the reader s own research, or for the advice of a qualified estate planning specialist familiar with the law of any given state. INSURANCE PRESERVATION TRUST HANDBOOK Page 16

Irrevocable Life Insurance Trust Checklist

Irrevocable Life Insurance Trust Checklist ESTATE PLANNING THE PRUDENTIAL INSURANCE COMPANY OF AMERICA Irrevocable Life Insurance Trust Checklist Transferring an Existing Policy or Purchasing a New Policy The following chart details the procedures

More information

LIFE INSURANCE TRUSTS

LIFE INSURANCE TRUSTS LIFE INSURANCE TRUSTS Robert M. Mendell, JD, CPA* Robert M. Mendell, Attorney at Law, P.C. 908 Town & Country Blvd. Suite 120 Houston, Texas 77024 (713) 888-0700 Fax: (713) 888-0800 Email: rmendell@mendellgroup.com

More information

Spousal Access Trusts Access To Cash Value Potential Through Flexible Trust Planning

Spousal Access Trusts Access To Cash Value Potential Through Flexible Trust Planning SALES STRATEGY Guiding you through life. ESTATE PLANNING Spousal Access Trusts Access To Cash Value Potential Through Flexible Trust Planning The Concerns Many clients who are concerned about maximizing

More information

KAROL HAUSMAN & SOSNIK, P.C. ATTORNEYS AND COUNSELORS AT LAW

KAROL HAUSMAN & SOSNIK, P.C. ATTORNEYS AND COUNSELORS AT LAW KAROL HAUSMAN & SOSNIK, P.C. ATTORNEYS AND COUNSELORS AT LAW 600 Old Country Road Garden City, New York 11530 Tel: (516) 745-0066 Fax: (516) 222-1499 E-Mail: KHS@KHSPC.com Counsel LOUIS P. KAROL MARC ALHONTE

More information

CLIENT INSTRUCTIONS FOR IRREVOCABLE LIFE INSURANCE TRUSTS, ANNUAL EXCLUSION GIFTS & ADMINISTRATION

CLIENT INSTRUCTIONS FOR IRREVOCABLE LIFE INSURANCE TRUSTS, ANNUAL EXCLUSION GIFTS & ADMINISTRATION CLIENT INSTRUCTIONS FOR IRREVOCABLE LIFE INSURANCE TRUSTS, ANNUAL EXCLUSION GIFTS & ADMINISTRATION In General Life insurance ownership through an Irrevocable Life Insurance Trust ( ILIT ) can remove the

More information

Irrevocable Life Insurance Trust

Irrevocable Life Insurance Trust Davis & Graves CPA LLP Jerry Davis, CPA/PFS 700 N Main Gresham, OR 97009 503-665-0173 jerryd@davisgraves.com www.jjdcpa.com Irrevocable Life Insurance Trust Page 1 of 9, see disclaimer on final page Irrevocable

More information

IRREVOCABLE TRUSTS Memorandum to the Settlor and the Trustee

IRREVOCABLE TRUSTS Memorandum to the Settlor and the Trustee Memorandum to the Settlor and the Trustee by Layne T. Rushforth 1. GENERALLY This memorandum is for the settlor (creator) and the trustee (manager) of an irrevocable trust. There is a section for each

More information

IRREVOCABLE LIFE INSURANCE TRUST OPERATING GUIDE

IRREVOCABLE LIFE INSURANCE TRUST OPERATING GUIDE IRREVOCABLE LIFE INSURANCE TRUST OPERATING GUIDE Law Office of Robert J. Mondo P.O. Box 72668 Roselle, Illinois 60172 (630) 215-3676 Fax (630) 894-8860 E-mail: bob@lawrjm.com Website: www.lawrjm.com This

More information

Advanced Markets Estate Planning for Non-Citizens in the United States

Advanced Markets Estate Planning for Non-Citizens in the United States Estate Planning for Non-Citizens in the United States SINGLE LIFE SPOUSAL ACCESS TRUSTS: A LIFE INSURANCE ALTERNATIVE As large numbers of people from other countries settle in the United States (U.S.),

More information

BASICS * Irrevocable Life Insurance Trusts

BASICS * Irrevocable Life Insurance Trusts KAREN S. GERSTNER & ASSOCIATES, P.C. 5615 Kirby Drive, Suite 306 Houston, Texas 77005-2448 Telephone (713) 520-5205 Fax (713) 520-5235 www.gerstnerlaw.com BASICS * Irrevocable Life Insurance Trusts Synopsis

More information

Sales Strategy Estate Planning for Non-Citizens in the United States

Sales Strategy Estate Planning for Non-Citizens in the United States Sales Strategy Estate Planning for Non-Citizens in the United States SINGLE LIFE SPOUSAL ACCESS TRUST: A LIFE INSURANCE ALTERNATIVE As large numbers of people from other countries settle in the United

More information

Comprehensive Split Dollar

Comprehensive Split Dollar Advanced Markets Client Guide Comprehensive Split Dollar Crafting a plan to meet your needs. John Hancock Life Insurance Company (U.S.A.) (John Hancock) John Hancock Life Insurance Company New York (John

More information

Administration Of An Irrevocable Life Insurance Trust 1

Administration Of An Irrevocable Life Insurance Trust 1 Administration Of An Irrevocable Life Insurance Trust 1 If you are reading this memorandum that probably means that you have adopted an irrevocable life insurance trust (referred to as an ILIT in this

More information

IRREVOCABLE LIFE INSURANCE TRUST CAUTION:

IRREVOCABLE LIFE INSURANCE TRUST CAUTION: CHERRY CREEK CORPORATE CENTER 4500 CHERRY CREEK DRIVE SOUTH #600 DENVER, CO 80246-1500 303.322.8943 WWW.WADEASH.COM DISCLAIMER Material presented on the Wade Ash Woods Hill & Farley, P.C., website is intended

More information

Maximizing Wealth Transfer using Innovative Trust Designs

Maximizing Wealth Transfer using Innovative Trust Designs Maximizing Wealth Transfer using Innovative Trust Designs For For Producer or or Broker/Dealer Use Use Only. Only. Not Not for for Public Distribution. Why Life Insurance? Provides for: Personal family

More information

IRREVOCABLE TRUST Questions and Answers

IRREVOCABLE TRUST Questions and Answers 1. Can Ascensus Trust handle trusts for individuals? Yes, through an Irrevocable Trust using life insurance as the sole funding vehicle. 2. Can proceeds be paid to beneficiaries in installments? Yes, The

More information

Estate planning strategies using life insurance in a trust Options for handling distributions, rollovers and conversions

Estate planning strategies using life insurance in a trust Options for handling distributions, rollovers and conversions Estate planning strategies using life insurance in a trust Options for handling distributions, rollovers and conversions Life s better when we re connected Table of contents Find your questions review

More information

IRREVOCABLE LIFE INSURANCE TRUSTS

IRREVOCABLE LIFE INSURANCE TRUSTS IRREVOCABLE LIFE INSURANCE TRUSTS March 9, 2016 H. Wes Taylor Foley & Lardner LLP 150 E. Gilman St. Madison, Wisconsin 53703 (608) 258-4213 wtaylor@foley.com A. Irrevocable Trusts a. In General. i. Irrevocable

More information

BUILDING FLEXIBILITY INTO THE TYPICAL IRREVOCABLE LIFE INSURANCE TRUST

BUILDING FLEXIBILITY INTO THE TYPICAL IRREVOCABLE LIFE INSURANCE TRUST BUILDING FLEXIBILITY INTO THE TYPICAL IRREVOCABLE LIFE INSURANCE TRUST Presented to the Kentucky Society of Certified Public Accountants, 48 th Annual Kentucky Institute on Federal Taxation, November 18,

More information

Advanced Designs. Pocket Guide. Private Split-Dollar Life Insurance Designs AD-OC-724B

Advanced Designs. Pocket Guide. Private Split-Dollar Life Insurance Designs AD-OC-724B Advanced Designs Pocket Guide Private Split-Dollar Life Insurance Designs AD-OC-724B This material is not intended to be used, nor can it be used by any taxpayer, for the purpose of avoiding U.S. federal,

More information

Irrevocable Life Insurance Trust (ILIT)

Irrevocable Life Insurance Trust (ILIT) Irrevocable Life Insurance Trust (ILIT) Overview An irrevocable life insurance trust (ILIT) can be a useful vehicle to hold life insurance policies outside the grantor s taxable estate. When an insured

More information

Irrevocable Life Insurance Trust (ILIT)

Irrevocable Life Insurance Trust (ILIT) THE WEALTH COUNSELOR LLC Irrevocable Life Insurance Trust (ILIT) What Is the Irrevocable Life Insurance Trust? An irrevocable trust is one in which the grantor completely gives up all rights in the property

More information

Topic: Washington Report 13-08 : Best Practices in Insurance Trust Administration are Critical to Preserve Planning Benefits.

Topic: Washington Report 13-08 : Best Practices in Insurance Trust Administration are Critical to Preserve Planning Benefits. The trusted source of actionable technical and marketplace knowledge for AALU members - the nation s most advanced life insurance professionals. The AALU Washington Report is published by AALUniversity,

More information

Wealth Planning Insights

Wealth Planning Insights Wealth Planning Insights Wealth Management Consulting March 2014 Contents Create a safety net for your family with life insurance Pages 1 4 The loss of income due to the premature death could seriously

More information

Allstate ChoiceRate Annuity

Allstate ChoiceRate Annuity Allstate ChoiceRate Annuity Allstate Life Insurance Company P.O. Box 80469 Lincoln, NE 68501-0469 Telephone Number: 1-800-203-0068 Fax Number: 1-866-628-1006 Prospectus dated May 1, 2008 Allstate Life

More information

Sales Strategy Sale to a Grantor Trust (SAGT)

Sales Strategy Sale to a Grantor Trust (SAGT) Estate planners have been using the Irrevocable Life Insurance Trust (ILIT) for many years, to increase wealth and liquidity outside the taxable estate. 1 However, transfers to ILITs One effective technique

More information

Prepared For: The Client Family

Prepared For: The Client Family Annuity Maximization Estate Planning and Deferred Annuities - Annuitization Prepared For: The Client Family Insurance products are issued by: John Hancock Life Insurance Company (U.S.A.), Boston, MA and

More information

IRREVOCABLE LIFE INSURANCE TRUSTS FOR ESTATE AND TAX PLANNING (Estate Planning Advisory No. 1)

IRREVOCABLE LIFE INSURANCE TRUSTS FOR ESTATE AND TAX PLANNING (Estate Planning Advisory No. 1) IRREVOCABLE LIFE INSURANCE TRUSTS FOR ESTATE AND TAX PLANNING (Estate Planning Advisory No. 1) This Advisory discusses the general estate planning and asset protection benefits of an irrevocable life insurance

More information

A Sole Proprietor Insured Buy-Sell Plan

A Sole Proprietor Insured Buy-Sell Plan A Sole Proprietor Insured Buy-Sell Plan At a sole proprietor s death, the business is dissolved and all business assets and liabilities become part of the sole proprietor's personal estate. Have you evaluated

More information

Irrevocable Life Insurance Trusts

Irrevocable Life Insurance Trusts Irrevocable Life Insurance Trusts Producer Guide 1 Irrevocable Life Insurance Trusts For producer use only. Not for distribution to the public. An In-Depth Look at the ILIT An irrevocable life insurance

More information

When an Irrevocable Trust Is Not: Giving New Life to Insurance Trusts

When an Irrevocable Trust Is Not: Giving New Life to Insurance Trusts When an Irrevocable Trust Is Not: Giving New Life to Insurance Trusts by Kevin B. Rack Must have independent trustee Take advantage of annual exclusion of $14,000 per beneficiary Requires annual letterwriting

More information

Featured Article: Contingent Owner Survivorship Life and the Standby Disclaimer ILIT

Featured Article: Contingent Owner Survivorship Life and the Standby Disclaimer ILIT Featured Article: Contingent Owner Survivorship Life and the Standby Disclaimer ILIT Russell E. Towers JD, CLU, ChFC Vice President - Business & Estate Planning Brokers' Service Marketing Group Introduction

More information

Request for Distribution from Individual Retirement Annuity, 403(b) Tax-Sheltered Annuity or Pension Plan

Request for Distribution from Individual Retirement Annuity, 403(b) Tax-Sheltered Annuity or Pension Plan Request for Distribution from Individual Retirement Annuity, 403(b) Tax-Sheltered Annuity or Pension Plan Standard Insurance Company Individual Annuities 800.247.6888 Tel 800.378.4570 Fax 1100 SW Sixth

More information

Death Benefit Distribution Claim Form Non-Spousal Beneficiary

Death Benefit Distribution Claim Form Non-Spousal Beneficiary Death Benefit Distribution Claim Form Non-Spousal Beneficiary READ THE ATTACHED IRS SPECIAL TAX NOTICE: IF THE PLAN ALLOWS FOR AN ANNUITY OPTION, READ THE WRITTEN EXPLANATION OF QUALIFIED JOINT AND 50%

More information

IRREVOCABLE TRUST CAUTION: The purposes of this memorandum are to assist you and the trustee of your irrevocable trust in:

IRREVOCABLE TRUST CAUTION: The purposes of this memorandum are to assist you and the trustee of your irrevocable trust in: CHERRY CREEK CORPORATE CENTER 4500 CHERRY CREEK DRIVE SOUTH #600 DENVER, CO 80246-1500 303.322.8943 WWW.WADEASH.COM DISCLAIMER Material presented on the Wade Ash Woods Hill & Farley, P.C., website is intended

More information

LIFE INSURANCE TRUST AGREEMENT

LIFE INSURANCE TRUST AGREEMENT LIFE INSURANCE TRUST AGREEMENT This Trust Agreement is made and entered into this June 12th 2005, by and between Harry Miller, (hereinafter referred to as "Grantor"), and Peter Stuart (hereinafter referred

More information

The New Era of Wealth Transfer Planning #1. American Taxpayer Relief Act Boosts Life Insurance. For agent use only. Not for public distribution.

The New Era of Wealth Transfer Planning #1. American Taxpayer Relief Act Boosts Life Insurance. For agent use only. Not for public distribution. The New Era of Wealth Transfer Planning #1 American Taxpayer Relief Act Boosts Life Insurance For agent use only. Not for public distribution. In January 2013 Congress stepped back from the fiscal cliff

More information

Life Insurance in Qualified Plans. Producer Guide. For agent use only. Not for public distribution.

Life Insurance in Qualified Plans. Producer Guide. For agent use only. Not for public distribution. Life Insurance in Qualified Plans Producer Guide For agent use only. Not for public distribution. Life Insurance In Qualified Plans While qualified plans are a tremendous retirement savings vehicle, they

More information

Spousal Lifetime Access Trust Using Legacy Advantage SUL Insurance Policy

Spousal Lifetime Access Trust Using Legacy Advantage SUL Insurance Policy Spousal Lifetime Access Trust Using Insurance Policy Supplemental Illustration Valued Client & Valued Client Prepared by: MetLife Agent 2 Park Ave. New York, NY 1166 Insurance Products: Not A Deposit Not

More information

Administrator. Any person to whom letters of administration have been issued to administer an intestate estate.

Administrator. Any person to whom letters of administration have been issued to administer an intestate estate. An Estate Planning Glossary The estate planning process is a complex one. During the course of your research into the firm to choose to handle your needs in administering your assets you will hear numerous

More information

The Flexibility of Cash Value Life Insurance

The Flexibility of Cash Value Life Insurance Advanced Markets The Flexibility of Cash Value Life Insurance Beyond Protection With today s focus on value and flexibility, cash value life insurance comes into its own. Beyond its main purpose of death

More information

DESCRIPTION OF THE PLAN

DESCRIPTION OF THE PLAN DESCRIPTION OF THE PLAN PURPOSE 1. What is the purpose of the Plan? The purpose of the Plan is to provide eligible record owners of common stock of the Company with a simple and convenient means of investing

More information

Understanding Life Insurance: A Lesson in Life Insurance

Understanding Life Insurance: A Lesson in Life Insurance Understanding Life Insurance: A Lesson in Life Insurance If something happens to you, how will your family replace your earning power? Table of Contents Page Your Earning Power 2 Life Insurance Questions

More information

Private Company Services. Estate Planning* A trustee s guide to the irrevocable life insurance trust. *connectedthinking

Private Company Services. Estate Planning* A trustee s guide to the irrevocable life insurance trust. *connectedthinking Private Company Services Estate Planning* A trustee s guide to the irrevocable life insurance trust *connectedthinking A trustee s guide to the irrevocable life insurance trust Introduction // 2 Trust

More information

Life Insurance Gifts: Planning Considerations

Life Insurance Gifts: Planning Considerations Life Insurance Gifts: Planning Considerations Gifts of life insurance are an additional option for charitable giving. While life insurance is not the answer to every financial planning and estate planning

More information

Estate Planning Basics. An Overview of the Estate Planning Process

Estate Planning Basics. An Overview of the Estate Planning Process Estate Planning Basics An Overview of the Estate Planning Process What Is an Estate Plan? An estate plan is a map This map reflects the way you want your personal and financial affairs to be handled in

More information

Probate Department 77 Fairfax Street, Suite 1A Berkeley Springs, WV 25411 Phone: (304) 258-8547 Fax: (304) 258-8545

Probate Department 77 Fairfax Street, Suite 1A Berkeley Springs, WV 25411 Phone: (304) 258-8547 Fax: (304) 258-8545 Probate Department 77 Fairfax Street, Suite 1A Berkeley Springs, WV 25411 Phone: (304) 258-8547 Fax: (304) 258-8545 PROBATE AND ESTATE ADMINISTRATION Morgan County, West Virginia The Probate Department

More information

Understanding Life Insurance

Understanding Life Insurance Understanding Life Insurance A Lesson in Traditional and Indexed Life Insurance 2012 VSA, LP Valid only if used prior to January 1, 2013. The information, general principles and conclusions presented in

More information

Executive Summary of the Defined Benefit Plan Engineering Financial and Economic Security for Multiple Generations

Executive Summary of the Defined Benefit Plan Engineering Financial and Economic Security for Multiple Generations Executive Summary of the Defined Benefit Plan Engineering Financial and Economic Security for Multiple Generations Benefit Focused vs. Lump Sum Focused Overview: What distinguishes a retirement plan which

More information

THE INCOME TAXATION OF ESTATES & TRUSTS

THE INCOME TAXATION OF ESTATES & TRUSTS The income taxation of estates and trusts can be complex because, as with partnerships, estates and trusts are a hybrid entity for income tax purposes. Trusts and estates are treated as an entity for certain

More information

Leveraging wealth transfer using private financing

Leveraging wealth transfer using private financing Private Financing Strategy Leveraging wealth transfer using private financing Not a bank or credit union deposit or obligation Not insured by any federal government agency Not FDIC or NCUA/NCUSIF insured

More information

Distribution Form Subject to Joint & Survivor Annuity

Distribution Form Subject to Joint & Survivor Annuity Distribution Form Subject to Joint & Survivor Annuity Please refer to the Plan s Summary Plan Description (SPD) for reasons distributions that are allowed in your plan. You may review the SPD, your account

More information

The Basics of Estate Planning

The Basics of Estate Planning The Basics of Estate Planning Introduction The process of estate planning can be a daunting prospect. Often individuals will avoid the process altogether. Obviously, this is not the best approach since

More information

COLLAPSING LIFE INSURANCE TRUSTS WHEN THEY ARE NO LONGER NEEDED

COLLAPSING LIFE INSURANCE TRUSTS WHEN THEY ARE NO LONGER NEEDED COLLAPSING LIFE INSURANCE TRUSTS WHEN THEY ARE NO LONGER NEEDED The client who is enamored initially with saving estate taxes on the proceeds of a life insurance policy by placing it in an irrevocable

More information

Understanding Life Insurance: A Lesson in Life Insurance

Understanding Life Insurance: A Lesson in Life Insurance Understanding Life : A Lesson in Life If something happens to you, how will your family replace your earning power? Table of Contents Page Your Earning Power 2 Life Questions 3 Types of Term 4 Term Variations

More information

133 Center Street, Bangor, Maine 04401-5097 (207)942-8815. Owners of Brookings-Smith are Gary W. Smith, Holly Smith Fernald and James R.

133 Center Street, Bangor, Maine 04401-5097 (207)942-8815. Owners of Brookings-Smith are Gary W. Smith, Holly Smith Fernald and James R. 133 Center Street, Bangor, Maine 04401-5097 (207)942-8815 Owners of Brookings-Smith are Gary W. Smith, Holly Smith Fernald and James R. Fernald CFSP Maine Mortuary Trust Agreement For the benefit of 1.

More information

INDIVIDUAL HEALTH SAVINGS ACCOUNT APPLICATION

INDIVIDUAL HEALTH SAVINGS ACCOUNT APPLICATION INDIVIDUAL HEALTH SAVINGS ACCOUNT APPLICATION ACCOUNT HOLDER S INFORMATION Last Name First Name Middle Initial Street Address City State Zip Code Social Security No. Date of Birth Daytime Phone Health

More information

Effective Planning with Life Insurance

Effective Planning with Life Insurance Effective Planning with Life Insurance The Tax Considerations... Ken Knox, CLU, ChFC Regional Director The Penn Mutual Life Insurance Company 1304529TM_Sept17 Retirement Planning Case Scenario #1... Client

More information

UNDERSTANDING PROBATE. The Family Guide PREPARED BY ROBERT L. FERRIS

UNDERSTANDING PROBATE. The Family Guide PREPARED BY ROBERT L. FERRIS UNDERSTANDING PROBATE The Family Guide PREPARED BY ROBERT L. FERRIS I FIRST STEPS: WHAT TO DO 1. Obtain certified copies of the Death Certificate. When a person dies in California, an official Death Certificate

More information

Sample Corporate Cross Purchase Agreement

Sample Corporate Cross Purchase Agreement Sample Corporate Cross Purchase Agreement (Optional Disability Buy-Out) This sample agreement has been prepared as a guide to assist attorneys. Our publication, Buy-Sell Arrangements, A Guide for Professional

More information

SAMPLE BUY-SELL AGREEMENT Should be reviewed by an attorney familiar with the laws in your state before using for your business.

SAMPLE BUY-SELL AGREEMENT Should be reviewed by an attorney familiar with the laws in your state before using for your business. SAMPLE BUY-SELL AGREEMENT Should be reviewed by an attorney familiar with the laws in your state before using for your business. This Buy-Sell Agreement (this "Agreement") is made effective as of, between

More information

NC General Statutes - Chapter 54C Article 8 1

NC General Statutes - Chapter 54C Article 8 1 Article 8. Operations. 54C-161. Generally accepted accounting principles. A savings bank shall maintain its books and records in accordance with generally accepted accounting principles. (1991, c. 680,

More information

Contributing to the stability of Trinidad and Tobago s Financial System. Deposit Insurance in Trinidad and Tobago. Information Booklet

Contributing to the stability of Trinidad and Tobago s Financial System. Deposit Insurance in Trinidad and Tobago. Information Booklet Contributing to the stability of Trinidad and Tobago s Financial System Deposit Insurance in Trinidad and Tobago Information Booklet Contributing to the stability of Trinidad and Tobago s Financial System

More information

YOUR INSURED FUNDS. National Credit Union Administration Office of Consumer Protection

YOUR INSURED FUNDS. National Credit Union Administration Office of Consumer Protection YOUR INSURED FUNDS National Credit Union Administration Office of Consumer Protection The National Credit Union Administration (NCUA) operates the National Credit Union Share Insurance Fund (NCUSIF) to

More information

Understanding Life Insurance: A Lesson in Life Insurance

Understanding Life Insurance: A Lesson in Life Insurance Understanding Life : A Lesson in Life If something happens to you, how will your family replace your earning power? Table of Contents Page Your Earning Power 2 Life Questions 3 Types of Term 4 Term Variations

More information

Contents. Deposit Account Contract Part 2

Contents. Deposit Account Contract Part 2 Deposit Account Contract Part 2 1-800-750-0959 www.fivecounty.com Contents CONTRACT TERMS AND DISCLOSURES 1 1. This is a Contract between You and Your Credit Union 1 2. Organization of Your & Our Contract

More information

Rising tuition for college education is a daunting

Rising tuition for college education is a daunting By Sharon L. Klein Paying for the (Grand) Kids College Know all the options and combinations thereof Rising tuition for college education is a daunting reality for many parents and grandparents. Even the

More information

1035 EXCHANGE / ROLLOVER / TRANSFER FORM

1035 EXCHANGE / ROLLOVER / TRANSFER FORM 1035 EXCHANGE / ROLLOVER / TRANSFER FORM Receiving Company This form can be used to accomplish a FULL or a PARTIAL Exchange of policies pursuant to Internal Revenue Code (IRC) Section 1035. This form can

More information

Web: www.aldavlaw.com Blog: www.californiatrustestateandprobatelitigation.com GIFTS TO MINORS

Web: www.aldavlaw.com Blog: www.californiatrustestateandprobatelitigation.com GIFTS TO MINORS Web: www.aldavlaw.com Blog: www.californiatrustestateandprobatelitigation.com GIFTS TO MINORS Grandparents and other relatives and friends often desire to make lifetime gifts to or for the benefit of a

More information

Internal Revenue Service

Internal Revenue Service Internal Revenue Service Number: 200925003 Release Date: 6/19/2009 Index Number: 2511.00-00, 2042.00-00, 61.09-38 ------------------------- ------------------------- ---------------------------- Department

More information

A Corporate Insured Stock Redemption Buy-Sell Plan

A Corporate Insured Stock Redemption Buy-Sell Plan A Corporate Insured Stock Redemption Buy-Sell Plan While the death of a shareholder may have no legal effect on a closely-held corporation, without advance planning there are some very real practical consequences

More information

EASY INSTRUCTIONS FOR CONTRACT CHANGE OR OWNERSHIP AUTHORIZATION REQUEST

EASY INSTRUCTIONS FOR CONTRACT CHANGE OR OWNERSHIP AUTHORIZATION REQUEST EASY INSTRUCTIONS FOR CONTRACT CHANGE OR OWNERSHIP AUTHORIZATION REQUEST Requesting changes to or designating ownership authorization for a contract requires the contract owner's signature. 1. Print, complete,

More information

Irrevocable Life Insurance Trusts: Perhaps the Best Kept Secret in Tax Savings

Irrevocable Life Insurance Trusts: Perhaps the Best Kept Secret in Tax Savings Irrevocable Life Insurance Trusts: Perhaps the Best Kept Secret in Tax Savings A. Jude Avelino * Life insurance is protection against the death of an individual in the form of payment to a beneficiary,

More information

Sales to Intentionally Defective Grantor Trusts (IDGT)

Sales to Intentionally Defective Grantor Trusts (IDGT) Sales to Intentionally Defective Grantor Trusts (IDGT) A sale to an Intentionally Defective Grantor Trust ( IDGT ) is a sophisticated estate planning strategy that can provide substantial benefits to wealthy

More information

Estate Planning. And The Second To Die Program. www.infarmbureau.com

Estate Planning. And The Second To Die Program. www.infarmbureau.com Estate Planning And The Second To Die Program www.infarmbureau.com Estate Planning and the Second to Die Program from Indiana Farm Bureau Insurance A source of satisfaction for most married couples is

More information

The Revocable Trust in Florida

The Revocable Trust in Florida The Revocable Trust in Florida The revocable, or living, trust is often promoted as a means of avoiding probate and saving taxes at death. The revocable trust has certain advantages over a traditional

More information

The Wealth Plan For Mr. & Mrs. Sample Client

The Wealth Plan For Mr. & Mrs. Sample Client The Wealth Plan For Mr. & Mrs. Sample Client John G. Griffin, CLU Chartered Financial Consultant April 2015 - Initial April 8, 2015 Mr. and Mrs. Sample Client Big Time Productions, Inc. 123 Smart Money

More information

Life Insurance: Your blueprint for Wealth Transfer Planning. Private Financing Producer Guide. For agent use only. Not for public distribution.

Life Insurance: Your blueprint for Wealth Transfer Planning. Private Financing Producer Guide. For agent use only. Not for public distribution. Life Insurance: Your blueprint for Wealth Transfer Planning Private Financing Producer Guide Private Financing Most people don t object to owning life insurance, they just object to paying the premiums.

More information

Tax Planning with Life Insurance

Tax Planning with Life Insurance Antell & Company Financial Strategies Jim Antell, CLU, ChFC, REBC 150 Bank Street Burlington, VT 05401 802-318-9149 802-318-9148 jim.antell@lpl.com www.antellcompany.com Tax Planning with Life Insurance

More information

47. Trusts and Annuities [Article 9J]

47. Trusts and Annuities [Article 9J] Medi-Cal Handbook page 47-1 47. 47.1 Background The Omnibus Reconciliation Act of 1993 (OBRA 93) was amended to provide new requirements for the treatment of trusts and annuities. The new procedures for

More information

THE ESTATE SETTLEMENT PROCESS

THE ESTATE SETTLEMENT PROCESS THE ESTATE SETTLEMENT PROCESS Please review this information carefully. The success of the probate depends on you. Settlement of an estate involves the process necessary to transfer asset ownership from

More information

ROTH IRA REQUIREMENTS

ROTH IRA REQUIREMENTS Regarding Roth Individual Retirement Annuity (IRA) Plans Described in Section 408A of the Internal Revenue Code This Disclosure Statement ( Disclosure ) presents a general overview of the federal laws

More information

Insight on estate planning

Insight on estate planning Insight on estate planning june.july.2004 Irrevocable life insurance trusts 5 things you need to know about to save taxes Should a trust be the beneficiary of your retirement plan? Providing estate plan

More information

ADVISING CLIENTS ABOUT LIFE INSURANCE: A PRIMER 1. By Andrew J. Willms, J.D. LL.M. John C. Zimdars, Jr., CLU ChFC. Introduction

ADVISING CLIENTS ABOUT LIFE INSURANCE: A PRIMER 1. By Andrew J. Willms, J.D. LL.M. John C. Zimdars, Jr., CLU ChFC. Introduction ADVISING CLIENTS ABOUT LIFE INSURANCE: A PRIMER 1 By Andrew J. Willms, J.D. LL.M. John C. Zimdars, Jr., CLU ChFC Introduction Over the last several years, tax reform has made tax planning increasingly

More information

Business Owner s Bonus Plan. Producer Guide. For agent/registered representative use only. Not for public distribution.

Business Owner s Bonus Plan. Producer Guide. For agent/registered representative use only. Not for public distribution. Business Owner s Bonus Plan Producer Guide For agent/registered representative use only. Not for public distribution. Business Owner s Bonus Plan Producer Guide The Business Owner s Bonus Plan is a personally

More information

Life Insurance Producer s Guide. Executive Bonus. Using Life Insurance. For Life Insurance Producer Use Only. Not for Use with the Public.

Life Insurance Producer s Guide. Executive Bonus. Using Life Insurance. For Life Insurance Producer Use Only. Not for Use with the Public. Life Insurance Producer s Guide Executive Bonus Using Life Insurance AD-OC-838A For Life Insurance Producer Use Only. Not for Use with the Public. Insurance products are issued by Pacific Life Insurance

More information

Life Insurance Review Using Legacy Advantage SUL Insurance Policy

Life Insurance Review Using Legacy Advantage SUL Insurance Policy Using Legacy Advantage SUL Insurance Policy Supplemental Illustration Prepared by: MetLife Agent 200 Park Ave. New York, NY 10166 Insurance Products: Not A Deposit Not FDIC-Insured Not Insured By Any Federal

More information

International Bond Key features

International Bond Key features International Bond Key features This is an important document. Please read it and keep for future reference. Helping you decide This key features document contains important information about the main

More information

A Fraternal Benefit Society Corrections must be initialed by Applicant. 1338 Military Street P.O. Box 5020 Port Huron M148061-5020 PART 1

A Fraternal Benefit Society Corrections must be initialed by Applicant. 1338 Military Street P.O. Box 5020 Port Huron M148061-5020 PART 1 Application for Membership and Single Premium Whole Life Insurance or Annuity Print carefully in Black Ink Woman's Life Insurance Society A Fraternal Benefit Society Corrections must be initialed by Applicant.

More information

Life Insurance for Estate Taxes THE SIMPLEST SOLUTION TO AN ESTATE TAX PROBLEM

Life Insurance for Estate Taxes THE SIMPLEST SOLUTION TO AN ESTATE TAX PROBLEM Life Insurance for Estate Taxes THE SIMPLEST SOLUTION TO AN ESTATE TAX PROBLEM M any successful individuals are shocked to learn that the federal estate tax may consume as much as 45% of their accumulated

More information

Life Insurance. Let the IRS Help You Make It The Most Profitable Year of Your Career. Secure Your Clients Futures. Unlock New Opportunities.

Life Insurance. Let the IRS Help You Make It The Most Profitable Year of Your Career. Secure Your Clients Futures. Unlock New Opportunities. Life Insurance 2012 Let the IRS Help You Make It The Most Profitable Year of Your Career Secure Your Clients Futures. Unlock New Opportunities. Are You Talking To Your Affluent Clients About The December

More information

THE CONSTRUCTION OF A SURVIVORSHIP LIFE INSURANCE POLICY

THE CONSTRUCTION OF A SURVIVORSHIP LIFE INSURANCE POLICY THE CONSTRUCTION OF A SURVIVORSHIP LIFE INSURANCE POLICY PERTINENT INFORMATION Mr. and Mrs. Kugler are considering $1,000,000 of life insurance to provide estate liquidity at the survivor s death to cover

More information

Code means the Internal Revenue Code of 1986, as amended.

Code means the Internal Revenue Code of 1986, as amended. The American Funds Roth IRA Trust Agreement Pending IRS approval. Section 1 Definitions As used in this trust agreement ( Agreement ) and the related Application, the following terms shall have the meaning

More information

ROTH IRA REQUIREMENTS

ROTH IRA REQUIREMENTS Regarding Roth Individual Retirement Annuity (IRA) Plans Described in Section 408A of the Internal Revenue Code This Disclosure Statement ( Disclosure ) presents a general overview of the federal laws

More information

Robert J. Ross 1622 W. Colonial Parkway, Suite 201 (847) 358-5757 Inverness, Illinois 60067 Fax (847) 358-7088 Bob@RobertJRoss.com

Robert J. Ross 1622 W. Colonial Parkway, Suite 201 (847) 358-5757 Inverness, Illinois 60067 Fax (847) 358-7088 Bob@RobertJRoss.com Law Offices of Robert J. Ross 1622 W. Colonial Parkway, Suite 201 (847) 358-5757 Inverness, Illinois 60067 Fax (847) 358-7088 Bob@RobertJRoss.com ESTATE PLANNING Estate planning is more than simply signing

More information

Protecting Life Insurance Proceeds: An Irrevocable Life Insurance Trust Review

Protecting Life Insurance Proceeds: An Irrevocable Life Insurance Trust Review Protecting Life Insurance Proceeds: An Irrevocable Life Insurance Trust Review Are you aware that an irrevocable life insurance trust can be used to remove life insurance proceeds from your taxable estate,

More information

Stock Power Form for transferring shares, changing names, or adding a beneficiary

Stock Power Form for transferring shares, changing names, or adding a beneficiary ... Stock Power Form for transferring shares, changing names, or adding a beneficiary Section A: Current Owner Information A new form is needed for each account and company of stock for which you are transferring.

More information

Payment Options. Retirement Benefit

Payment Options. Retirement Benefit Payment Options Retirement Benefit Table of contents Choosing your benefit payment option... 2 Life Annuities... 5 Fixed Period Benefit... 7 Installment Benefit... 8 Combination of Benefits... 10 Single

More information

Generation Skipping Transfer Tax

Generation Skipping Transfer Tax Generation Skipping Transfer Tax Producer Guide For agent use only. Not for public distribution. Generation Skipping Transfer Tax Summary The generation skipping transfer (GST) tax is a complex tax. This

More information

Premium Financing of Life Insurance

Premium Financing of Life Insurance Element Insurance Partners 13520 California Street Suite 290 Omaha, NE 68154 402-614-2661 dhenry@elementinsurancepartners.com www.elementinsurancepartners.com Premium Financing of Life Insurance Page 1

More information