What is an ILIT?
An ILIT is similar to all trusts in that assets transferred to it are administered by a trustee who is required to follow the trust instructions. However, unlike revocable trusts that are usually established for the Trustmaker’s benefit and which can be amended by the Trustmaker at any time and for any reason, an ILIT is established for the benefit of someone other than the Trustmaker, usually the Trustmaker’s spouse or children. Furthermore, once created ILITs usually cannot be amended, at least not without the permission of a court of law. Neither of these limitations, though, is usually significant in light of the great planning opportunities available with an ILIT.