by Guest » Tue May 29, 2012 04:17 pm
Age 60/62, the net worth over 14m all from real estate with big monthly mortgage now. We had 3 kids 29, 32, 35 and each one had their own GST
trust they fund by our LLC K-1 to these trust to pay for their own WL insurance, and also paid the premium for our SVUL & VUL, both policy had 3M each dead benefit and own by ILIT.
-Year 2000 the ILIT got 1st SVUL total cost had paid was 175,000 & CV right now is 200,000
-year 2006 ILIT got 2nd SUL policy total cost had paid was 76,207 & CV right now is 20,000.
Now we learn these 2 police in the ILIT are not guarantee our age till 100 and will lapse also will not do our estate purpose :(
I want my agent to do 1035 exchange with no lapsed guarantee on new policy cover our age to 103/105. WL police price are too high is UL or Indexed UL policy with guarantee will work for us? Can I do the one 1035 exchange own by ILIT, and the 2nd 1035 exchange own by the 3 GST (1/3 benefit each or 1M each). The reason b/c GST distribute term are difference & better them ILIT.
Is the LI policy are best & fast way to increase our assest to our love one? Thank you very much!
trust they fund by our LLC K-1 to these trust to pay for their own WL insurance, and also paid the premium for our SVUL & VUL, both policy had 3M each dead benefit and own by ILIT.
-Year 2000 the ILIT got 1st SVUL total cost had paid was 175,000 & CV right now is 200,000
-year 2006 ILIT got 2nd SUL policy total cost had paid was 76,207 & CV right now is 20,000.
Now we learn these 2 police in the ILIT are not guarantee our age till 100 and will lapse also will not do our estate purpose :(
I want my agent to do 1035 exchange with no lapsed guarantee on new policy cover our age to 103/105. WL police price are too high is UL or Indexed UL policy with guarantee will work for us? Can I do the one 1035 exchange own by ILIT, and the 2nd 1035 exchange own by the 3 GST (1/3 benefit each or 1M each). The reason b/c GST distribute term are difference & better them ILIT.
Is the LI policy are best & fast way to increase our assest to our love one? Thank you very much!
Posted: Thu May 31, 2012 12:28 am Post Subject:
Suffice it to say your SUL policies will not lapse if you commit more money to them. A Section 1035 Exchange may or may not be appropriate in your situation, and it may be entirely unnecessary.
Also, new policies of any kind at your current ages will be considerably more expensive than what you currently have which were issued 11-12 years ago, and you could cause more trouble for yourself in a 1035 Exchange than you realize. Done incorrectly, it can cause irreparable harm and result in unrecoverable tax losses, and I've seen the effects of this first hand in some of the cases I've worked this year.
Your situation is very complex and there are no simple answers to your questions. What you need is an in depth policy analysis of your current programs to determine where your policies are currently heading, and identify the best course of action for the future. The majority of agents are incapable of doing this kind of analysis, and insurance companies provide only the foundational information (called an "in-force illustration") necessary to perform the kind of detailed analysis your situation most likely requires.
And even after such an analysis is completed, you will still need to consult your tax professional(s) and trust attorney(s) for their recommendations in view of the analysis.
Performing such detailed policy analysis has been my profession for a number of years. Please email me (click on the link below) to conduct a confidential, expanded discussion of your situation. It would be inappropriate for anyone to offer specific advice for a situation such as yours in an open forum such as this.
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