Spousal Access Trusts

Scott M. McCullough (Associate, Callister, Nebeker & McCullough, Salt Lake City, UT) has written a new article entitled The Spousal Access Irrevocable Life Insurance Trust Funded with a Second-to-Die Policy, Prob. & Prop., May/June 2009, at 61.

Estate planners advising clients with substantial wealth face a significant problem helping them formulate a tax-efficient strategy to pass wealth to their children and grandchildren without the crippling effect of gift, estate, and generation-skipping transfer taxes while at the same time allowing the clients to maintain some level of control over their assets and ensure adequete income for the remainder of their lives. The biggest problem in the clients eyes is losing control of their assets before they die. This article discusses a more specific type of irrevocable life insurance trust (ILIT) called a spousal access trust (SAT). The SAT holds a second-to-die policy as its main asset, yet provides the surviving spouse access to the cash value of that policy.