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ILIT |
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ILITs: Finally, an ILIT continues to be a great way to house the ownership of life insurance policies and to protect the proceeds from being included in an insured's estate, thus avoiding estate taxation. Before policy cash values became too large, the policy would be distributed to the plan participant and ultimately gifted to his ILIT, or the ILIT would be pre-funded with enough cash to buy the policy directly from the plan for its cash surrender value. Or an ILIT may be used as part of a split-dollar insurance plan or trusteed buy-sell arrangement. |
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