Legal Question in Wills and Trusts in New Jersey

Re: Life Insurance Proceeds

You should have an Irrevocable Life Insurance Trust set-up for your child. Without a trust, your child would get the entire proceeds at age 18. In addition to protecting the money until your child is old enough to be financially responsible, the Trust would also allow you to direct how the funds are used. For example, you could limit the expenses to educational puposes, or buying a home, etc.

You should talk to a tax and estate planning attorney about this.

I hope this helps!

Ron Cappuccio

http://www.SaveYourEstate.com

Re: Life Insurance Proceeds

I agree with Ron, not only for the reasons he specified, but also to possibly save on Inheritance taxes. By using a irrevocable trust, which will become both the owner and beneficiary, the proceeds of the policy, presuming you live 3 years from the transfer date, will not be part of your estate subject to death taxes. I recommend using a general irrevocable trust (not one just limited to life insurance) as the benefits are great and it will afford you flexability if your marital and/or family situation changes over time, as well as income tax flexibility if other assets are added to the trust now or in the future. I have done literally hundreds of these trusts, so if you need further information, contact me directly.