Kenneth Vercammen & Associates
Edison, NJ 08817
732-572-0500
Toll Free 1-877-NJLaws1
68 So. Main St,
Cranbury, NJ 08512
By Appointment Only
800-655-2977
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.
The Law Office of Kenneth Vercammen can provide experienced attorney representation for criminal and motor vehicle violations. When your job or driver's license is in jeopardy or you are facing thousands of dollars in fines, DMV/MVC surcharges and car insurance increases, you need excellent legal representation. The least expensive attorney is not always the answer. Schedule a free in-office consultation if you need experienced legal representation in a traffic/municipal court matter.
Our website www.njlaws.com provides information on traffic offenses we can be retained to represent people. Our website also provides details on jail terms for traffic violations and car insurance eligibility points. Car insurance companies increase rates or drop customers based on moving violations. Call the Law Office of Kenneth Vercammen at 732-572-0500 to schedule a free in-office consultation to hire a trial attorney for Criminal/ DWI/ Municipal Court Traffic/ Drug offenses.
Celebrating 20+ years of providing excellent service to clients since 1985. We handle trials to win! 2nd degree black belt, trialthlete and member of state champion masters racing team. Always competitive!
Kenneth Vercammen & Associates, P.C.
at 732-572-0500
for an appointment