Irrevocable trusts

Who Can You Trust with Your Policy Finding the Right Fiduciaries for Insurance Trusts.

Topics: Estate planning, Fiduciary, Irrevocable trusts, Trusts

ILITs are a mainstay in legacy and life insurance planning, and having a responsible, experienced trustee is critical for the ILIT to achieve the client’s objectives. Finding suitable ILIT trustees, however, has become increasingly difficult, particularly given the complexities and potential liabilities associated with ILIT administration (both before and after receipt of policy death benefits),…

Annual Exclusion Allowed for 60 Crummey Beneficiaries, Despite No-Contest and Mandatory Arbitration Clauses

Topics: Estate planning, Irrevocable trusts, Trusts

The Tax Court held that gifts to an irrevocable trust qualified for the gift tax annual exclusion because each of the trust’s 60 beneficiaries had Crummey withdrawal powers, and despite the fact that the trust included both (1) no-contest clauses disinheriting a beneficiary who questioned a trustee’s discretionary actions, and (2) a requirement that all...

Third Circuit Denies Coventry Motion to Compel Arbitration in Life Settlement Case Alleging Fraud and Bid-Rigging

Topics: Estate planning, Irrevocable trusts, Trusts

This case was an appeal to the Third Circuit by Coventry First LLC, a life settlement company, from a decision of the United States District Court for the Eastern District of Pennsylvania. Lincoln T. Griswold purchased an $8.4 million life insurance policy on his life that was sold after two years to Coventry First LLC.

PLR Says Sale of Life Policies by Joint Trust to Husband’s Irrevocable Grantor Trust Avoids Transfer for Value Problems

Topics: Estate planning, Grantor trusts, Irrevocable trusts, IRS, Trusts

In PLR 201423009 the IRS ruled that a transfer of a survivorship life insurance policy from a husband and wife grantor trust to a grantor trust of which the husband is treated as the owner for income tax purposes would not trigger the loss of the income tax exclusion at the insured’s death under the…