Irrevocable Life Insurance Trust for Married Individual (Trusts for Spouse and Children) (IL)
Summary
This template is an irrevocable life insurance trust (ILIT) for a married individual to hold one or more insurance policies on the life of grantor in Illinois. This template contains practical guidance, drafting notes, alternate clauses, and optional clauses. This instrument may be used for the benefit of the surviving spouse and descendants. It is most suitable for clients who may have a taxable estate and who desire to provide for their surviving spouse and descendants with the proceeds of the insurance policies transferred to the trust. An ILIT is an irrevocable trust established to be the beneficiary of a life insurance policy. If the premiums are gifted to the trust, then the life insurance proceeds will not be included in the grantor's estate for federal estate tax. There is a common misconception that life insurance proceeds are not subject to federal estate taxes. While the proceeds are free from income tax, they are countable as part of the grantor's taxable estate. An ILIT ...