1. Trustee (insured’s spouse) has the right to distribute income generated by the trust as well as the principal of the trust to the insured’s spouse as long as the insured lives. The trustee also has the right to borrow on the cash value of the life insurance policies on the life of the insured owned by the trust and then distribute the funds so obtained to the insured’s spouse as long as the insured is alive.
2. Trustee (cannot be insured) has the right to distribute income generated by the trust and/or principal of the trust to the insured. The trustee also has the right to borrow on the cash value of the life insurance policies on the life of the insured owned by the trust and then distribute the funds so obtained to the insured.
3. split dollar life insurance policy is established within the trust with the insured’s spouse having ownership rights to the cash value part of the split dollar policy and the trust having ownership rights to the death benefit minus the cash value. Through this mechanism, the insured’s spouse has access to the cash value while the insured is alive. Upon the death of the insured and insured’s spouse, the amount of the death benefit minus the cash value will not be subject to estate tax.
| Irrevocable, Invitee, Investor-Related Life Insurance | |
| Irrevocable Living Trust, Irrevocable Trust, Issue Department |
