Crummey Trusts: Irrevocable Life Insurance Trusts, Beneficiary Powers, and Notification Requirements

Note: CLE credit is not offered on this program

Recording of a 110-minute CPE webinar with Q&A


Conducted on Thursday, July 23, 2020

Recorded event now available

or call 1-800-926-7926
Program Materials

This webinar will explore the benefits of Crummey trusts, Crummey powers, notification requirements, and possibly the best use of these powers--the irrevocable life insurance trust (ILIT).

Description

Crummey trusts are beneficial in several ways. Money or assets under the annual exclusion amount ($15,000 in 2020) can be transferred to the trust and escape transfer tax. These trusts can be used for the benefit of a minor, creditor protection, and can include spend-thrift provisions.

ILITs may be the trust that benefits the most from Crummey powers. ILITs can be used to transfer life insurance proceeds tax-free to a beneficiary--if appropriately structured. When the trust rather than the decedent owns the policy, the family receives the money but avoids payment of estate tax (40% in 2020).

Crummey powers allow a beneficiary a right to withdraw money placed in a trust. This power is what makes the contribution a present interest gift eligible for the annual exclusion. Trust advisers need to understand how to utilize Crummey powers and properly notify beneficiaries. Advisers need to understand the drawbacks of ILITs since they are by nature, irrevocable.

Listen as our panel of trust experts explains Crummey powers, fulfilling notification requirements, establishing ILITs, and other uses of Crummey trusts.

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Outline

  1. Crummey trusts
  2. Notification requirements
  3. Irrevocable life insurance trusts
  4. Other Crummey trusts
  5. IRC Sections 677 and 678
  6. Gift tax compliance

Benefits

The panel will review these and other vital issues:

  • How an estate can benefit from an ILIT
  • How to meet Crummey notification requirements
  • How Crummey trusts are utilized in estate planning
  • What are the most recent challenges to Crummey powers?

Faculty

Clear, Michael
Michael T. Clear

Partner
Wiggin and Dana

Mr. Clear focuses his practice on estate planning, estate and trust administration, probate litigation, and...  |  Read More

Lipoff, Lawrence
Lawrence M. Lipoff, CPA, TEP, CEBS

Director
CohnReznick

With more than 30 years of experience, Mr. Lipoff specializes in the delivery of domestic and international private...  |  Read More

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