LAW OFFICES OF
Boyd Boyd, P.C.
IRREVOCABLE LIFE INSURANCE TRUST · PLAN HOW THE BENEFIT SERVES YOUR FAMILY.
You Bought Insurance for Your Family. Plan How It Reaches Them.
Coordinate policy ownership, premium gifts, and trust instructions so your life insurance fits your inheritance and estate-tax goals. Understand the decisions and ongoing duties before you act.
What Is an Irrevocable Life Insurance Trust?
An Irrevocable Life Insurance Trust, or ILIT, is designed to own a policy and manage its proceeds under instructions for your beneficiaries. It connects the coverage you have with the family plan you want.
The trust document, insurer records, funding process, and trustee’s work should all support the same objectives. Begin by reviewing who owns your insurance and what the benefit needs to accomplish.
The Policy and the Plan Should Work Together.
A death benefit may look sufficient on a policy statement, yet questions remain: Who owns the policy? Who receives the proceeds? Who will manage the money for a child? How are premiums funded? What happens if the trustee cannot serve?
An ILIT review connects those decisions with your estate plan. The aim is a clear arrangement your trustee can maintain and your family can rely on when the benefit is needed.
Start With Your Life Insurance Trust Question.
Choose the question on your mind. The answer and next steps below will adjust to match.
You can change your question at any time.
YOUR QUESTION, ANSWERED
What Is an Irrevocable Life Insurance Trust?
Give the Policy a Clear Role in Your Family’s Plan.
An ILIT is an irrevocable trust designed to own life insurance and manage the proceeds for its beneficiaries. The trustee handles the policy under the trust’s instructions.
It can help coordinate an inheritance, provide funds for family needs, and support estate-tax planning. The result depends on ownership, retained powers, funding, and the trust terms.
YOUR FAMILY’S FUTURE
What This Means for Your Family
A thoughtfully designed trust can give your family instructions for managing a substantial death benefit instead of leaving every decision to be made after a loss.
THE DETAIL THAT MATTERS
What to Review Before You Act
Identify the insured, owner, premium source, beneficiaries, and trustee. These roles are different, and each can affect the legal and tax analysis.
YOUR NEXT DECISION
Clarify What Your Insurance Should Accomplish.
Discuss your existing coverage, family needs, and estate plan so the appropriate role for an insurance trust can be evaluated.
YOUR QUESTION, ANSWERED
Why Use a Trust if Life Insurance Is Already Tax-Free?
Income Tax and Estate Tax Ask Different Questions.
Death benefits are generally excluded from federal income tax, but interest and certain policy transfers can change that treatment. This income-tax rule does not determine estate-tax inclusion.
Proceeds can be included in the insured’s estate when payable to the estate or when the insured retains ownership powers. Proper ILIT planning aims to avoid inclusion; federal and Massachusetts estate-tax rules need coordinated review.
YOUR FAMILY’S FUTURE
What This Means for Your Family
Reviewing the full estate can help your family understand how insurance affects the resources available after taxes and expenses.
THE DETAIL THAT MATTERS
What to Review Before You Act
Naming children or a trust as beneficiary alone does not settle estate-tax treatment. Review ownership, policy rights, beneficiary designations, and the estate’s other assets.
YOUR NEXT DECISION
Review Your Policy’s Estate-Tax Exposure.
Discuss who owns the policy and how its death benefit fits your federal and state estate-tax planning.
YOUR QUESTION, ANSWERED
Can I Transfer an Existing Policy Into an ILIT?
Review the Transfer Before Changing Ownership.
An existing policy may be transferred, or a trustee may arrange for the trust to acquire new coverage. The two approaches require different review.
When an insured transfers ownership rights in an existing policy and dies within three years, the proceeds may be brought back into the federal gross estate. Policy value, gift reporting, and any transfer-for-value issues also need analysis.
YOUR FAMILY’S FUTURE
What This Means for Your Family
A coordinated transfer can help avoid gaps between what your documents say and what the insurance company’s records show.
THE DETAIL THAT MATTERS
What to Review Before You Act
Bring the policy, ownership and beneficiary records, current statements, loan information, and any replacement proposal. Confirm the intended changes with legal and insurance advisers before signing insurer forms.
YOUR NEXT DECISION
Evaluate Your Existing Policy Before You Transfer It.
Review the policy and proposed ownership changes so timing, valuation, and reporting issues can be identified.
YOUR QUESTION, ANSWERED
Can I Still Control the Policy or Change the Trust?
Choose the Terms With the Loss of Personal Control in Mind.
You should not assume you can personally change beneficiaries, cancel the policy, or borrow against its value after moving it into an ILIT. Retained policy powers can undermine the estate-tax objective.
Irrevocable does not mean every future adjustment is impossible. Massachusetts law allows certain court-approved modifications, subject to requirements. Any proposed change needs review for both trust-law and tax consequences.
YOUR FAMILY’S FUTURE
What This Means for Your Family
Choose beneficiaries, trustee successors, and distribution instructions carefully at the beginning, while considering how your family may change over time.
THE DETAIL THAT MATTERS
What to Review Before You Act
Distinguish what the trustee may do from what the insured may do. Review any reserved powers and do not treat policy cash value as your personal emergency fund.
YOUR NEXT DECISION
Understand the Control You Keep—and Give Up.
Discuss the proposed powers and trust terms so you can make an informed decision before committing the policy.
YOUR QUESTION, ANSWERED
How Will My Family Receive and Use the Proceeds?
Plan for the People Who Will Need the Money.
After the insured’s death, the trustee collects the benefit and follows the trust’s distribution terms. Those terms may provide support for a spouse or children, staged distributions, or continuing trusts.
The plan should address each beneficiary’s circumstances, including minors, disability, and financial vulnerability. Creditor protection, public-benefit eligibility, and generation-skipping tax results require tailored review; an ILIT does not guarantee them.
YOUR FAMILY’S FUTURE
What This Means for Your Family
Clear directions can help the trustee balance immediate support with the resources your family may need for many years.
THE DETAIL THAT MATTERS
What to Review Before You Act
Coordinate the ILIT with your other trusts and estate documents. If estate liquidity is a goal, review how funds could be made available without provisions that defeat the intended tax treatment.
YOUR NEXT DECISION
Design the Proceeds Around Your Family’s Needs.
Discuss who should benefit, what support they may need, and how the insurance fits your broader inheritance plan.
YOUR QUESTION, ANSWERED
Who Should Be Trustee—and What Ongoing Work Is Required?
The Trust Needs Attention While the Insured Is Living.
The trustee must administer the trust under its terms and applicable law. Practical work includes tracking contributions, withdrawal notices, premiums, policy performance, and insurer records.
After a death, the trustee handles the claim, manages proceeds, makes authorized distributions, and maintains appropriate records and reports. Select someone capable of carrying out the work and name successors.
YOUR FAMILY’S FUTURE
What This Means for Your Family
A reliable trustee and coordinated advisers can reduce uncertainty about coverage, paperwork, and the eventual use of the benefit.
THE DETAIL THAT MATTERS
What to Review Before You Act
Discuss availability, skills, compensation, and the need for professional help. Boyd Boyd, P.C. charges professional trustee fees based on trust size; legal, insurance, and tax services may involve separate costs.
YOUR NEXT DECISION
Plan for the Work That Keeps Your ILIT Effective.
Discuss trustee choices, ongoing duties, and expected costs so responsibility is clear from the start.
IN A REVIEWER’S OWN WORDS
Clarity and Confidence
★★★★★ 5-Star Google Review
“Everyone was extremely helpful during the entire process and we feel confident that we have a sensible and comprehensive estate plan.”
— Pamela Gordon
Review excerpts reflect individual experiences and do not guarantee an outcome for another family.
Your Family at the Center. Our Team Beside You.
F. Keats Boyd III and Whitney N. Tashjian help families think through important Estate Planning and Wealth Protection Planning decisions. At Boyd Boyd, P.C., the conversation begins with what you want to protect and what you want the next generation to understand.
Seven Life Insurance Trust Questions, Answered
What Is an Irrevocable Life Insurance Trust?
An ILIT owns life insurance and directs how the proceeds are managed for beneficiaries. Its design must fit the rest of your estate plan.
Why Use a Trust if Life Insurance Is Already Tax-Free?
A generally income-tax-free death benefit can still be included in an estate. Policy ownership and retained powers matter for estate-tax planning.
Can I Transfer an Existing Policy Into an ILIT?
Existing-policy transfers require review of the three-year estate-inclusion rule, gift valuation, and other tax issues. New coverage needs its own ownership planning.
How Are Premiums Funded—and What Are Crummey Notices?
Premium contributions may require genuine withdrawal rights and proper notices for annual-exclusion treatment. Gift-tax reporting must be reviewed separately.
Can I Still Control the Policy or Change the Trust?
Retained policy control can affect estate inclusion. Changes to an irrevocable trust require document-specific legal and tax review.
How Will My Family Receive and Use the Proceeds?
The trustee uses the proceeds under the trust’s terms. Distribution planning should reflect the needs and circumstances of each beneficiary.
Who Should Be Trustee—and What Ongoing Work Is Required?
Trustee work begins before the death claim. Contributions, notices, premiums, policy review, and later administration all need assigned responsibility.
Related Planning and Primary Sources
Updated October 4, 2026. Ownership, policy terms, transfer history, gifts, retained powers, and applicable federal and state law determine the analysis.
Can We Work Together if You Live Outside Massachusetts?
Boyd Boyd, P.C. assists families nationwide. Families outside Massachusetts may come to our office to sign, or we may work with co-counsel licensed in their home state. The property, applicable law, and proposed role determine how the work should be structured.
YOUR FREE ESTATE PLANNING STRATEGY SESSION
Clarify What Your Insurance Should Accomplish.
Discuss your existing coverage, family needs, and estate plan so the appropriate role for an insurance trust can be evaluated.
Connect Your Coverage With Your Family’s Plan.
Bring policy statements, ownership and beneficiary information, any existing trust, and an overview of your estate. Boyd Boyd, P.C. can discuss the legal planning questions and areas requiring coordinated insurance and tax review.
The free session is an initial planning conversation. Trust preparation, implementation, ongoing administration, insurance, and tax services are separately scoped and priced.
Call 508-444-9688 to request your session.
1555 Iyannough Road, Unit 1BW • Hyannis, Massachusetts 02601
(508) 444-9688 • plan@boydandboydpc.com
© 2026 Boyd Boyd, P.C.
General information only. Legal advice depends on your circumstances and an attorney-client engagement.