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Tom Meaglia, ChFC®, AEP®,

CLU®, CRPC®, MSFS

Chartered Financial Consultant

Investment Advisor Representative

Chartered Retirement Planning Counselor

CA Insurance Lic. #0567507

 

Meaglia Financial Consulting

2105 Foothill Blvd., #B140, La Verne, CA 91750

 

Toll Free: 800-386-3700

Bus:         909-593-6105

Cell:         818-681-8600

Fax:         909-593-6120

 

Email: tom@meagliafinancialconsulting.com

Website: www.meagliafinancialconsulting.com

September/October 2018

Legacy Planning

Legacy Planning

By itself, life insurance — with its income tax-free death benefit — offers families and business owners an efficient estate planning funding vehicle. When combined with a trust, life insurance can accomplish even more.


Multiple Benefits
A life insurance trust isn’t for everyone. Because the trust is irrevocable, you should make sure this estate strategy is what you want. If it is, a life insurance trust offers a number of benefits. This type of trust can provide control, because the trust can include terms that govern how its assets are distributed, which can be a priority for people with minor and young adult children. Another advantage is privacy, as any assets owned by the trust can avoid the public glare of probate.


Estate Tax Tool
Another benefit is that any assets transferred to an irrevocable trust are removed from your taxable estate. This is still important for a couple of reasons.


One, even while the threshold at which federal estate taxes are levied was doubled this year, some states have estate and inheritance taxes on far smaller amounts. If you live in one of these states, an irrevocable trust can save your estate’s beneficiaries money.


Two, life insurance death benefits are not subject to federal and many states’ income taxes, but they can be subject to estate taxes. Putting life insurance inside an irrevocable trust makes the policy’s death benefit free of both federal income and federal estate taxes. Just as with other assets, a trust’s terms can dictate when and how the insurance proceeds can pass to beneficiaries.


Getting Started
To set up a trust, you will need to name a trustee, which can be a loved one, an advisor or even a financial institution. Next, you will need to dictate the trust’s terms for distributing trust assets to beneficiaries, whom you must also name.


If an irrevocable life insurance trust is of interest to you, consult an experienced estate planning attorney to
learn how to get started, as well as an insurance professional to learn how you can most effectively secure
insurance coverage.


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Thomas Meaglia is an Investment Adviser Representative of Coppell Advisory Solutions LLC, dba, Fusion Capital Management, a registered investment adviser that only conducts business in jurisdictions where it is properly registered, or is excluded or exempted from registration requirements. Registration as an investment adviser is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability. The firm is not engaged in the practice of law or accounting.
Insurance and annuity products are not sold through Fusion Capital Management. Fusion does not endorse any annuity or insurance product, nor does it guarantee any insurance or annuity performance. Annuity and life insurance guarantees are subject to the claims-paying ability of the issuing insurance company. If you withdraw money from or surrender your contract within a certain time after investing, the insurance company may assess a surrender charge. Withdrawals may be subject to tax penalties and income taxes. Persons selling annuities and other insurance products receive compensation for these transactions. These commissions are separate and distinct from Fusion's investment advisory fees.
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