Canadian Irrevocable Life Insurance Trust
Are the proceeds of life insurance taxable to Canadian residents at death? If so, is it possible for a Canadian resident to avoid tax on the proceeds of a life insurance policy by having an irrevocable life insurance trust purchase the policy?
1 Answer from Attorneys
These are great questions but I have better ones.
Who is this for?1) Are they American(s)?2) Are they planning to "die" in Canada?3) Is the insurance company a U.S. company?4) To whom will they wish to leave their money, anyway?5) How big is the estate? 6) How are old are the owner(s)?7) How large are the policy values right now?
Even once I get these answers, I'll have to look it up in the IRS code and regs to answer your question.
It's not in the spirit of this BBS, but I really think you should have paid counsel. Certainly you would have such counsel at the time you'd draft the CILIT, wouldn't you?If you have a taxable estate, you can afford to pay your own attorney to look it up, can you not?
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