Titles in the series are listed following the last narrative section of each document. Reading the documents in this series will improve your understanding of estate planning tools and alternatives, and make it easier to communicate with your attorney, accountant, and other helpers when your estate plan is prepared. While the information contained in this document is thought to be accurate, it should not be used as a substitute for legal advice on matters related to business organization, taxation, estate planning, gifting of assets, life insurance, or other business and financial management matters. Consult with your legal and tax advisers before making decisions.
Life insurance can be an important estate planning tool.
Under appropriate arrangements, the face value of life insurance is not subject to estate, inheritance, or gift taxes. Thus, there are tax incentives for including life insurance in your estate plan. As might be expected with these tax attributes, life insurance use in estate planning occurs within a framework set by many laws, regulations, and Internal Revenue Service rulings, a framework determining the tax status of life insurance proceeds in each situation or set of circumstances. This publication discusses aspects of life insurance and its use as an estate planning tool, aspects frequently mentioned in discussion periods of estate planning meetings. Since this discussion can provide only partial information on a very complex topic, be sure to secure professional advice before making decisions.