Estate Planning Last reviewed: 2026-10-03 Part of Estate planning and ILITs

Life Insurance and Estate Planning: The ILIT Guides

Written and reviewed by Hans Goldstein, licensed insurance producer, NPN 20602398 · CA Insurance License #4273294
Last reviewed October 3, 2026 · Published October 3, 2026

Editorial review by a licensed agent who may earn a commission. No insurer pays for placement or grades. Hans is paid a commission by the insurer if you buy a policy through him. For life insurance, ask and he will tell you what he earns on your specific policy.

Short answer: life insurance does two jobs in an estate plan: it creates cash when the estate needs it (estate tax, equalizing heirs, keeping a business or farm), and, held in an irrevocable life insurance trust (ILIT), it can pass outside your taxable estate. The 2026 federal exemption is $15,000,000 per person ($30,000,000 for a married couple with portability), so most families do not need an ILIT for federal tax. Those projected over the line, or with property in an estate-tax state, often do. Hans is not an attorney; your estate attorney drafts the trust.

The decision path

Do you need one? Do I need an ILIT? · The 2026 exemption · California estate tax (there is none) · Estate tax calculator
How life insurance is taxed at death. Life insurance and estate tax
How premiums get into the trust. The $19,000 annual exclusion · Crummey powers · Crummey letters
Which policy. GUL vs IUL in a trust · Survivorship life insurance · GUL reviews
Grandchildren and dynasty planning. GST and life insurance
Moving a policy you already own. The 3-year rule
Large premiums. Premium financing
Running the trust. ILIT trustee duties
Alternatives. SLAT vs ILIT

The pillar guide ties it together: the ILIT guide.

The 2026 numbers in one table

Federal estate, gift and GST figures for 2026

Item	2026
Basic exclusion (estate and lifetime gift)	$15,000,000 per person, indexed after 2026
Married couple with portability	$30,000,000
Top estate tax rate	40%
GST exemption	$15,000,000
Annual gift exclusion	$19,000 per recipient ($38,000 split)
Gift to a non-citizen spouse	$194,000

Sources: IRS Rev. Proc. 2025-32; IRC 2010; IRC 2001.

Estate planning

Is an ILIT worth a conversation?

Send your email and I'll send the estate-tax worksheet and a policy design read within one business day.

We’ll email it to you. Hans Goldstein · NPN 20602398.

Rather talk it through? Or book 15 minutes on Hans’s calendar.

Who should keep reading

Married couples whose net worth, grown forward at 4 to 6% a year, passes $30,000,000 in their lifetimes.
Owners of real property or residence in an estate-tax state, where thresholds start at $1,000,000 (Oregon).
Families with an illiquid estate (business, farm, real estate) that would have to sell to pay a bill.
Anyone with non-tax goals: creditor protection for heirs, blended families, a child with special needs.

Projected over the exemption, or own property in an estate-tax state?

Send a net worth range and your state. Within one business day you get a plain-English read on whether an ILIT is worth discussing with your attorney, and the policy design that would fit.

Rather talk it through? Or book 15 minutes on Hans’s calendar, or call 213-414-2808.

Hans Goldstein · 213-414-2808 · NPN 20602398, independent licensed insurance producer

Frequently asked questions

How does life insurance help with estate planning?

It creates cash when the estate needs it, such as for estate tax or equalizing heirs, and when owned by an irrevocable trust it can be kept out of the taxable estate.

What is the 2026 estate tax exemption?

$15,000,000 per person, or $30,000,000 for a married couple using portability, indexed for inflation after 2026.

Do I need an ILIT?

Usually only if your projected estate exceeds the exemption, you own property in an estate-tax state, or you have non-tax goals like protecting heirs' inheritances.

Who drafts an ILIT?

Your estate attorney. Hans designs and places the policy and coordinates with the attorney and CPA.

What life insurance goes in an ILIT?

Usually guaranteed universal life or survivorship coverage for a known death benefit at the lowest guaranteed cost. Indexed policies can fit if funded and monitored.

Sources

Hans Goldstein, CA Insurance License #4273294 · NPN 20602398 · Goldstein & Co. LLC dba Goldstein Insurance Services, CA License #6016830

Contact: hans@hansgoldstein.com · 213-414-2808

General education, not tax or legal advice. Tax treatment depends on your facts and on current law, which can change. Talk to your CPA or estate attorney. Guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company. Guarantees apply only to the contractual terms of the policy. Caps, participation rates, loan rates, charges and dividends are not guaranteed and can change. Hans is not an attorney. An ILIT is drafted by your estate attorney; coordinate premium gifts and Form 709 filings with your CPA. Hans is paid a commission by the insurer if you buy a policy through him. For life insurance, ask and he will tell you what he earns on your specific policy. Product and company names are trademarks of their owners. Goldstein Insurance Services is an independent agency, not affiliated with or endorsed by any insurer named here. Life insurance requires underwriting; not everyone qualifies. This page describes products in general terms; read the policy and the insurer's disclosures before you buy.