Private Placement Life Insurance And Split DollarPrivate Placement Life Insurance And Split Dollar

When individuals are engaged in extensive wealth transfer planning, issues related to gifting and efficient funding of life insurance policies are often key topics in minimizing the impact on an estate. Within the context of that planning, individuals secure traditional life insurance products owned by irrevocable trusts while at the same time seek options to effectively manage their investments for optimal performance from a tax perspective. The product and funding alternatives merge and create opportunities to incorporate split-dollar financing for private placement life insurance (PPLI). 

To minimize or eliminate estate taxes, PPLI is generally owned or placed in an irrevocable life insurance trust (ILIT), usually designed as a grantor...