Part 35
Thomas M. Boles, 33, G.C.

The combination of a Charitable Remainder Trust and an Irrevocable Life Insurance Trust is a win-win situation for everyone.

Please Note: This information is distributed with the understanding that the author is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expertise is required, the services of a competent professional should be sought. From: A Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers.

I have had a few “shopper’s drop into the store, and they wanted to know about Wealth Replacement. I told them that I wrote about this a few months back. You see, wealth replacement and Life Insurance Trust are really the same thing! It just depends on to whom you are talking, and what they learned when getting educated on estate planning. One thing is sure, they both mean replacing your assets for your family and/or other heirs. By using the income tax savings and part of the income you receive from the Charitable Remainder Trust, you can fund an Irrevocable Life Insurance Trust. Each year you can “gift” money to the trust, and the trustee can then purchase enough life insurance to replace the value of the property. When you die, your children or other heirs will receive the full proceeds from the insurance trust without probate and, better yet, free from income and estate taxes.

Life insurance is the fastest and most inexpensive way to replace personal and family assets. But if you are uninsurable, the trustee can buy other appreciating asset, i.e. zero-coupon bonds, certain stocks, and real estate to replace the value of the property you transfer to the trust. The combination of a Charitable Remainder Trust and an Irrevocable Life Insurance Trust is a win-win situation for everyone! Here is what really happens:

-You can take an immediate charitable income tax deduction and remove a highly appreciated asset from your estate, thus saving income and estate taxes.

-You receive a guaranteed lifetime income without the headaches or uncertainty of having to manage the investment.

-When you pass on, your children (or other beneficiaries) receive cash from the life insurance trust, replacing the value of the asset free from income tax, estate tax, and probate tax.

-And you are able to make a substantial gift to one or several charities.

Now when you hear the terms Wealth Replacement Trust and Irrevocable Life Insurance Trust, you will know what they’re talking about. And, it is something you might want to talk about now. If so, please give me a call or drop me a line. Which leaves my “ad” for the month to read:

A good trustee of wealth is the provider for tomorrow.

For an investment of securities and/or real estate, please run a calculation and send it to me based on an investment of $__________. Assume the cost basis of the asset (what was originally paid, less depreciation) is $__________.

My birth date is _________________; My spouse’s is _________________.

Name ____________________________ Date _______________________

Address _______________________________________________________

City _________________________ State ________ Zip _______________

Send to: Scottish Rite Foundation, c/o Thomas M. Boles, 1761 East Woodcrest Avenue, La Habra, CA 90631-3260

The Scottish Rite Pooled Income Fund allows you and, if you wish, your wife and/or other beneficiary(ies) to receive a worry-free lifetime income as well as attractive tax benefits by joining the Fund via a financial gift to The Scottish Rite Foundation, S.J., USA. For more information call, 1-800-486-3331 or fax 202-387-1843.

Grand Commander Kleinknecht will personally respond to your inquiry. If he is not available, please leave your name and number, and the Grand Commander will return your call at his earliest opportunity. Through the Scottish Rite Pooled Income Fund, you can do well for yourself and your family while also doing good for others!