Irrevocable Life Insurance Trusts

Irrevocable Life Insurance Trusts

“Irrevocable Life Insurance Trusts” (or ILITs), if established properly, can keep life insurance proceeds out of the insured individual’s taxable estate for estate tax purposes.  Under a properly structured plan the ILIT becomes both the owner and beneficiary of the life insurance policy on the insured’s life.  The proceeds are outside of probate and free from not only estate taxes but income taxes.  In situations where an individual dies owning assets that are difficult to liquidate, the proceeds payable to the ILIT can be used to satisfy any estate tax obligations of the estate as well as pay other expenses incurred after the decedent’s death.  Any proceeds left over will ultimately be distributed to the decedent’s beneficiaries.  There are a number of complicated issues associated with ILITs and ERIC H. LIGHT, P.A. is experienced in addressing these issues with its clients to allow them to achieve their desired goals

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