The decline of corporate-owned life insurance for the closely-held business owner

Article Abstract:

Corporate-owned life insurance policies have been the traditional method that owners of closely held businesses use to fund buy-sell agreements, but this may not be the best strategy. The reasons for avoiding corporate-owned policies include that insurance proceeds are not protected from creditors and a tax-bracket advantage no longer exists. An alternative method for funding buy-sell agreements is to purchase cross-owned split dollar insurance.

Author: Dann, Donald R., Davis, Herbert J., Levin, Lanny D.
Publisher: American Society of CLU
Publication Name: Journal of the American Society of CLU & ChFC
Subject: Law
ISSN: 1052-2875
Year: 1992
Close corporations, Closely held corporations, Insurance, Split-dollar life insurance, Split dollar life insurance

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Life insurance for the liquid estate

Article Abstract:

Life insurance traditionally has been a source of liquidity for large estates consisting of illiquid assets, but life insurance can also be used with a liquid estate. Estate planners should investigate life insurance as an alternative to Crummey-style demand rights, the Unified Credit and the avoidance of grantor taxable income. A life insurance trust is a superior estate planning tool because it can finance transfers of capital.

Author: Gallagher, Hillery James
Publisher: American Society of CLU
Publication Name: Journal of the American Society of CLU & ChFC
Subject: Law
ISSN: 1052-2875
Year: 1992
Methods, Life insurance, Estate planning, Crummey trusts

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Subjects list: Analysis
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