An Irrevocable Life Insurance Trust Is A Tax Planning Tool

An Irrevocable Life Insurance Trust (ILIT) places the proceeds from a life insurance policy into a trust effectively removing the assets from your estate. This vehicle is an effective tax planning device. You need to work with a knowledgeable estate planning lawyer in order to determine whether this tool may be right in your circumstances.

Susan Borquez can take the guesswork out of the estate planning process. She has been helping California families in the Simi Valley and across Ventura County for more than 30 years. She will review your financial picture and recommend an estate plan customized to meet your needs.

Estate Taxes

The federal exemption amount changes each year, and the current tax rate on assets above this threshold is 40 percent. It is important to realize that life insurance proceeds are includable in your estate for estate tax purposes. Thus, a large policy meant to protect your family could potentially come with an unintended tax burden.

An ILIT can provide several benefits, including:

  • Lower estate tax liabilities by reducing the size of your estate
  • Protection for beneficiaries who receive government assistance
  • Control over when and how beneficiaries receive funds from the policy

Attorney Susan Borquez will explain the requirements of this type of trust and assist you to properly set up the life insurance trust, if an ILIT suits your needs.

Begin The Process

An Irrevocable Life Insurance Trust must be set up properly to be effective. Contact Susan Borquez who has more than 30 years of estate planning experience and can analyze whether this tool is right for you. Call 805-603-4518 or complete our online form to schedule an appointment.