Kenneth
Vercammen & Associates
A Law Office with
Experienced Attorneys for Your New Jersey Legal Needs
| 2053 Woodbridge
Ave.
|
   |
Kenneth
Vercammen & Associates |
||
|
Life Insurance Trust |
| A number
of opportunities are available for estate planning with life insurance.
Many different types of life insurance products are on the market
today, including "Term Insurance", "Universal Life
Insurance", "Split Dollar Insurance" and "Whole
Life Insurance". Depending upon the particular situation, one
or more of these products may have a valuable place in your estate
plan. "Split Dollar Insurance" provides that a portion of
the cost is paid by a business entity, the other portion is paid by
another person (e.g., the insured). Payment of a potion of the premiums
by the business creates taxable income to the employee-insured. The
beneficiary can be the insured, his estate, the business or family
members. These policies are useful to provide cash on the death of
the insured which can then be available to fund buy-sell agreement
in which the employee pays for the term portion of a policy, while
the corporation pays for the whole life or investment portion. With
each of these products, it is possible to establish an irrevocable
life insurance trust during your lifetime so that in the event you
die more than three years after the creation of the trust, the insurance
proceeds can be excluded from both your taxable estate and from the
taxable estate of your surviving spouse. An insurance trust might
provide that upon your death, the proceeds from your life insurance
policies are to be collected by your Trustees (one of whom can be
your spouse) and all of the income from the trust is to be paid to
your spouse for life. The Trustees (other than your spouse) could
have the right to invade the principal of the trust for your spouse's
benefit. Upon the death of your spouse, the assets could pass to your
successor beneficiaries, such as your children, either outright or
in further trust. To the extent that the value of the trust increases
during the term of the trust, all of the trust assets, including the
appreciation, will pass to the ultimate beneficiaries. If you are
presently discussing the possibility of purchasing life insurance,
consideration should be given to whether the policy should be owned
by an individual or by a trust, as well as the selection of the beneficiaries.
A number of advantages and disadvantages of insurance trusts should be considered. Advantages (a) If you die more than three years after the creation of the trust and its funding, the assets in the trust are excluded from your estate. (b) The trust will provide liquidity to help pay the estate taxes and administration expenses that may be payable on your other assets. Disadvantages (a) The trust is irrevocable and the provisions of the trust (including ownership of the policy by the trust), cannot be changed even if circumstances change. Grantor Retained Income Trust ("Grit") This type of trust involves a current gift by you to a trust wherein the "Grantor" (you) retains an income interest for a specified number of years (the "Term") and at the expiration of the term, one or more named beneficiaries receive the assets in the trust, either outright or in further trust. The IRS actuarial tables, which presently assume a 10% return on trust investments, are used to value the remainder interests for gift tax purposes.
|
|
|
|
Meet with an experienced
Attorney to handle your important legal needs. |
|
Kenneth Vercammen is the Managing Attorney at Kenneth Vercammen & Associates in Edison, NJ. He is a New Jersey trial attorney has devoted a substantial portion of his professional time to the preparation and trial of litigated matters. He has appears in Courts throughout New Jersey each week for litigation and contested Probate hearings. Mr. Vercammen has published over 125 legal articles in national and New Jersey publications on elder law, probate and litigation topics. He is a highly regarded lecturer on litigation issues for the American Bar Association, NJ ICLE, New Jersey State Bar Association and Middlesex County Bar Association. His articles have been published in noted publications included New Jersey Law Journal, ABA Law Practice Management Magazine, and New Jersey Lawyer. He is chair of the Elder Law Committee of the American Bar Association General Practice Division. He is also Editor of the ABA Estate Planning Probate Committee Newsletter and also the Criminal Law Committee newsletter. Mr. Vercammen is a recipient of the NJSBA- YLD Service to the Bar Award. And past Winner "General Practice Attorney of the Year" from the NJ State Bar Association. He is a 22 year active member of the American Bar Association. He is also a member of the ABA Real Property, Probate & Trust Section. He established the NJlaws website www.njlaws.com which includes many articles on Elder Law. Mr. Vercammen received his B.S., cum laude, from the University of Scranton and his J.D. from Widener/Delaware Law School, where he was the Case Note Editor of the Delaware Law Forum, a member of the Law Review and the winner of the Delaware Trial Competition. RECENT SPEAKING ENGAGEMENTS ON WILLS, ELDER LAW, AND PROBATE Edison Adult School -Wills, Elder Law & Probate- 2007, 2006, 2005,
2004, 2003, 2002 [inc Edison TV], 2001, 2000,1999,1998,1997 Contact
the Law Office of The Law Office cannot provide legal advice or answer legal questions over the phone or by email. Please call the Law office and schedule a confidential "in office" consultation. The Law Office now accepts payment by American Express, Visa and Master Card. .
Disclaimer This web site is purely a public resource of general New Jersey information (intended, but not promised or guaranteed to be correct, complete, or up-to-date). It is not intended be a source of legal advice, do not rely on information at this site or others in place of the advice of competent counsel. The Law Office of Kenneth Vercammen complies with the New Jersey Rules of Professional Conduct. This web site is not sponsored or associated with any particular linked entity unless specifically stated. The existence of any particular link is simply intended to imply potential interest to the reader, inclusion of a link should not be construed as an endorsement.
Last Revised April 29, 2008 İ 2008 Kenneth Vercammen & Associates, P.C. |
