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I am single and have a minor child. I have life insurance through my employer. I want to set up a Trust for the life insurance funds in the event of my death. Should I set up an Irrevocable Trust or an Irrevocable Trust Funded by Life Insurance? I only want to speak about the life insurance monies in the Trust agreement. If you have any other suggestions, please let me know. Thanks.
15 ANSWERS
Bankruptcy Attorney serving Florissant, MO
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Law Offices of Thomas Corcoran Phipps
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Do an irrevocable trust for life insurance. If you want to put any other property in trust, do a revocable trust wit you as the trustee.
Answered on Jul 18th, 2013 at 5:52 AM
The question becomes, who do you want to get the life insurance; your child? or others. The issue appears to be protecting your child. If you want your child to get it at a date later than your death... say at 21, then yes an irrevocable trust might be the answer; however you will need a trustee, guardian type and you have to be concerned that the life insurance provided by your employer may end with employment or you may have to bear the cost of the life insurance. An irrevocable trust cannot be altered later,
Answered on Jul 18th, 2013 at 5:51 AM
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Since it is an employee benefit, an irrevocable life insurance trust will not provide the type of benefit you are looking for. Just name your regular trust as the beneficiary.
Answered on Jul 17th, 2013 at 11:37 AM
Business Planning Attorney serving Livonia, MI
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Frederick & Frederick Attorneys at Law
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Unless your estate is more than $5.25 million, then you should not be setting up ANY kind of irrevocable trust. A revocable trust would be just fine.
Answered on Jul 17th, 2013 at 12:14 AM
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You need to meet with an attorney to discuss what you are trying to accomplish. Generally irrevocable trusts are not the best way to go, especially with a minor child, because things change over time. If you are simply trying to provide for your child in the event something happens to you, you will have much more control and flexibility with a revocable instrument that can do the same thing. At James Law Group we make every effort to respond to you quickly and efficiently. This means we may be responding to you from a mobile device. As you know, responding on these devices can result in typographical errors that my otherwise not occur. In order to provide this extra service, please be aware of this and excuse any errors that may be caused by responding in this forum.
Answered on Jul 16th, 2013 at 8:01 PM
Probate Attorney serving Newport, OR
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Minor, Bandonis & Haggerty P.C.
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The labels you refer to are only that, labels, with no real meaning. If you set up an irrevocable trust, and it is funded by life insurance, that's an Irrevocable Trust Funded by Life Insurance. The terms of the trust matter. Please do this as part of a general estate plan, with a good lawyer. Getting something off the internet is going to cost your child more in the long run.
Answered on Jul 16th, 2013 at 8:01 PM
Actually either would do the same. The most important part of the whole process will be funding the trust with the life insurance which means that the beneficiary will have to be changed to name the trust not your child(ren).
Answered on Jul 16th, 2013 at 8:00 PM
You probably want to establish a revocable trust so you can amend it anytime.
Answered on Jul 16th, 2013 at 8:00 PM
Thomas Edward Gates
You will start a Irrevocable Trust for your child using the insurance money.
Answered on Jul 16th, 2013 at 7:59 PM
Your needs are not necessarily the same as your friend, neighbor, sibling. It is difficult to tell you what you should do because you are unique, this is not cookie cutter work. You need to talk with an attorney to discuss what you need. You should not undertake preparing a trust without an attorney.
Answered on Jul 16th, 2013 at 7:59 PM
Business Law Attorney serving Bingham Farms, MI
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James T. Weiner, P.C.
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I would set up a revocable trust which becomes irrevocable if you die... that way you are not locked into anything.. Have your parents, or another trusted sibling, be the successor trustee Why do you want an irrevocable trust anyway?
Answered on Jul 16th, 2013 at 7:59 PM
Real Property Law Attorney serving San Francisco, CA
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Law Office of Barbara A. Goode
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Unless you have a very large estate that will subject you to inheritance tax (ie over $3 million) you may not need to set up a life insurance trust. Those are normally used to provide the proceeds of a large life insurance policy to a beneficiary and avoid estate taxes. If you do have this issue, I would consult an attorney, but in essence you should set up an irrevocable life insurance trust. A revocable trust will not provide you with the tax benefits. If you do not have this issue, you could probably just designate your child as the beneficiary of the proceeds and set up a regular revocable trust to manage the assets in the event that your child is still a minor when you pass.
Answered on Jul 16th, 2013 at 7:58 PM
Probate Attorney serving New Orleans, LA
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James G. Maguire
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You would set up a REVOCABLE trust, and make the trust the beneficiary of the policy. The trust should be revocable because when the minor child reaches the age of majority (or some other age you determine), you would want the funds to go to the child directly rather than into the trust.
Answered on Jul 16th, 2013 at 7:58 PM
Commercial Contracts Attorney serving Boise, ID
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Peters Law, PLLC
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I would suggest setting up the trust in your Will so that the proceeds go to your estate. You will have a number of other properties to dispose of. So you may have all of the estate go into the trust, just the insurance proceeds or a combination.
Answered on Jul 16th, 2013 at 7:58 PM
They are one and and the same. Work with an attorney specializing in estate planning to avoid any confusion in the nickname of trusts.
Answered on Jul 16th, 2013 at 7:57 PM