Passing on Your Estate:
Irrevocable Life Insurance Trusts

An Irrevocable Life Insurance Trust (ILIT) is an estate planning tool for passing wealth to the next generation. An ILIT is created to purchase a life insurance policy for the client. The insurance policy is typically the only asset in the trust. Upon the client's death, the proceeds from the life insurance policy go to the stated beneficiary or beneficiaries, and will not be included in the client's taxable estate. Generally this allows the client to pass on more of their estate to their heirs without incurring estate tax penalties.

Clients often take advantage of the annual gift tax exclusion, making gifts to the trust to cover the cost of the insurance premium. Please consult your tax professional for details.

 
 

Irrevocable Life Insurance Trusts, also referred to as "Crummey" trusts, provide a method for someone to divest their estate upon death without the proceeds being subject to estate tax.

 
Irrevocable Life Insurance Trusts

As trustee of your irrevocable life insurance trust, Stifel Trust provides these services:

  • Preparation and distribution of periodic withdrawal notices
  • Insurance premium payment services
  • Investment selection and performance monitoring for variable policies
  • Annual review of insurance policy
  • Receipt of life insurance proceeds upon the insured's death
  • Administration of the trust according to its terms
  • Preparation of the trust's income tax return (if required)
  • Quarterly statements

 
 
For more information on Irrevocable Life Insurance Trust Services, please contact your Stifel Financial Advisor.