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    Nov 9 12

    Spousal Trusts – A Valuable Tool For Newport Beach Families

    Newport Beach Law Firm

    Couples with assets valued between $20
    million and as high as $50 million typically are reluctant to give away $5
    million or $10 million, in case they someday need the gifted assets.  A spousal lifetime access trust (SLAT),
    coupled with the purchase by the SLAT of some life insurance, may provide the
    best of both worlds:  a completed gift,
    removal of trust assets from a couples’ gross estate and a tax-favored
    leveraged death benefit, all while allowing a beneficiary spouse the
    flexibility of retaining tax-efficient access to the policy cash value, if
    needed in the future.

    Man and Woman on SwingsThe trouble with any gifting
    strategy is that any gift is gone once given. While given assets don’t count
    against your estate, they also aren’t there if you need them later. This can be
    a legitimate concern, whether you have a little or a lot.

    With the longer lifespans we now
    enjoy and the expensive healthcare costs we now face, one strategy is to use
    gifts to purchase life insurance as a gift for your heirs, and to do so with a
    trust arrangement known as a SLAT.

    A SLAT, or “Spousal Lifetime
    Access Trust” enjoyed the spotlight in a recent WealthManagement.com article titled “SLATs
    and Life Insurance: Have Your Cake and Eat it Too
    .

    Now, knowing how to have your
    cake and eat it too can require a complex bit of planning. However, done right,
    such planning can be powerful. Problem: when life insurance is owned by an
    individual it ends up counting towards their estate value by virtue of such
    “incidents of ownership.” A Spousal Lifetime Access Trust that owns a life
    insurance policy (a tactic normally seen in traditional Irrevocable Life
    Insurance Trusts) will allow access on the part of your spouse during their
    lifetime while also funding the policy for your heirs. If this sounds too good
    to be true, then it just might be if all of the i’s and t’s are not dotted and
    crossed properly.

    To learn more about this
    temperamental and advanced, if potent, device, review the original article and
    consult with Meier Law Firm.

    Contact your Newport Beach
    estate planning attorneys at Meier Law Firm to discuss all of your estate
    planning needs
    .

    Reference: Wealth
    Management.com
    (October 17, 2012) “SLATs
    and Life Insurance: Have Your Cake and Eat it Too




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