ILIT
Law & Legal abbreviation · Estate and Family Law
| Stands for | Irrevocable life insurance trust |
|---|---|
| Categories | Law & Legal |
ILIT stands for Irrevocable life insurance trust, an estate and family law abbreviation also used in business.
Trust created to own life insurance so that the death benefit stays out of the insured's taxable estate and passes to beneficiaries under the trust's terms. Premiums are usually funded by annual gifts from the insured.
Example: The ILIT owns the $5 million policy, so the proceeds won't be included in his estate.
Usage notes
Pronounced "EYE-lit". If an existing policy is transferred to an ILIT, the insured must survive three years for the proceeds to escape estate tax under Internal Revenue Code § 2035. Beneficiaries are usually given temporary withdrawal rights, called Crummey powers, so premium gifts qualify for the annual gift tax exclusion.
Related abbreviations
More estate and family law abbreviations
- GAL – Guardian ad litem
- GRAT – Grantor retained annuity trust
- GST – Generation-skipping transfer tax
- HCPOA – Health care power of attorney
- ICPC – Interstate Compact on the Placement of Children
- IDGT – Intentionally defective grantor trust
- JDR – Juvenile and domestic relations district court
- JTWROS – Joint tenants with right of survivorship
- LPA – Lasting power of attorney
- MSA – Marital settlement agreement
- PFA – Protection from abuse order
- PINS – Person in need of supervision
See all 50 estate and family law abbreviations →
This entry is for general education and is not legal advice. Abbreviation use varies between institutions; always confirm in context.