Life Insurance Policy Review Written by Drew Monday, 24 January 2011 20:45 | |
Life Insurance Policy review is crucial. To that end here is a tremendous success story with an insured that closed recently.
At Aspen Executive Life, we work closely with many attorneys and CPA’s one day recently we got a call from one of our referral partners on a case where the death benefit had dropped from $5,000,000 to $ 2,500,000. Additionally the premiums were going from $0 to $ 25,000 per year. Upon review of the policy we executed a 1035 exchange with the cash value in the policy and doubled the death benefit from $2,500,000 MM back to $5,000,000 without any further premiums!
Needless to say both the clients and the attorney were thrilled and amazed.
Life Insurance Policy review is a necessity especially if the policy is an older one, substantial gains in death benefit and reductions in premiums can be had by filling out just a very simple form.
At Aspen Executive life we work almost exclusively with high net worth individuals and specialize in Estate Planning and other Advanced Markets Insured products. 
Fill out our contact form or call us in Aspen at 970-925-5900. We look forward to discussing your Estate Planning and Life Insurance needs at your convenience. | | Last Updated on Wednesday, 09 May 2012 10:28 |
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Irrevocable Life Insurance Trust Written by Drew Monday, 24 January 2011 20:44 | |
An irrevocable life insurance trust or (ILIT) is a trust created that owns life insurance. It is irrevocable, meaning it may not be changed, revoked or modified at any time after its initial drafting. With a properly drafted ILIT, life insurance proceeds can be received by the grantor's loved ones free from federal gift, estate, or income taxes. This is why life insurance is such an effective Estate Planning tool.
A properly drafted and administered ILIT will exclude life insurance proceeds from the insured's estate. The ILIT is established, and then a gift of cash is made to the trust so its trustee can purchase, and the trust will then own, the life insurance policy.
At the time the grantor passes away, the life insurance policy's death benefit is paid to the trust which accomplishes a multitude of objectives, including:
* Providing a stream of income or lump sum cash resources for the trust's beneficiary(ies)
* Providing a source of liquidity to pay estate settlement costs primarily to the IRS, but can also include unpaid debts, state and federal transfer taxes, administrative fees, burial costs, and professional fees such as those charged by accountants and attorneys
* Protecting trust assets from the beneficiary's creditors and predators such as legal claims arising from lawsuits, divorce, or bankruptcy
* Establishing financial management of assets for the grantor's loved ones, which is helpful if the loved ones live in separate states, have differing interests or goals, or have difficulty managing money effectively through the use of an appointed fiduciary.
* ILITS also do a good job of maintaining confidentiality, as trusts are private documents as opposed to public record as many other entities are.
* Avoiding probate and its attendant costs for assets held by the trust
* Maximizing the advantage of the lifetime gift tax exemption and/or annual gift tax exclusion, as long as the gifts to the trust are created as "present interest gifts" and care is taken.
* Avoiding federal estate taxes on assets held by the trust.
The estate and generation-skipping transfer tax was repealed for 2010. In 2011, the federal estate tax exemption is $5 million with a rate of 35%.
As such there has never been a better time in recent history to move very large sums of wealth from one generation to another.
If you need to set up and fund an Irrevocable Life Insurance Trust Call Aspen Executive Life at 970-925-5900 or Request a Quote.
| | Last Updated on Monday, 25 June 2012 14:05 |
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