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Ilit

Draft Irrevocable Life Insurance Trusts in Minutes

12 minutes with CaseMark

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12 minutes with CaseMark

What you'll need

  • Client Intake Form
  • Life Insurance Policy Documents

SOC 2 Type II · HIPAA compliant · $5 free credit

Workflow

Overview

CaseMark's ILIT drafting skill generates comprehensive Irrevocable Life Insurance Trust documents that comply with IRC § 2042 and applicable state trust laws. The AI produces fully structured trust instruments complete with Crummey withdrawal rights, trustee powers, distribution provisions, and proper execution formalities—transforming hours of complex drafting into a streamlined, guided workflow.

Drafting an Irrevocable Life Insurance Trust requires navigating a complex intersection of federal tax code provisions, state trust laws, and precise drafting conventions. A single misstep—such as retaining an incident of ownership or omitting Crummey withdrawal notices—can cause the entire life insurance proceeds to be included in the grantor's taxable estate, defeating the trust's core purpose.

CaseMark automates the drafting of IRC § 2042-compliant ILITs by guiding attorneys through structured intake and generating trust documents with proper irrevocability language, Crummey powers, trustee restrictions, and policy transfer provisions. The result is a comprehensive, jurisdiction-aware trust instrument ready for attorney review and client execution.

How it works

  1. 1. Upload client intake details, insurance policy documents, and any existing estate plan materials

  2. 2. AI analyzes policy structures, beneficiary designations, and jurisdictional requirements to draft a compliant ILIT

  3. 3. Review and customize trust provisions including Crummey powers, trustee succession, and distribution terms

  4. 4. Export the finalized trust document in your preferred format (DOCX, PDF)

What you get

  • Declaration of Trust & Irrevocability Provisions

  • Party Designations & Trustee Succession

  • Trust Property Schedule & Policy Transfer Assignments

  • Crummey Withdrawal Rights & Notice Procedures

  • Distribution Provisions & Minor Sub-Trusts

  • Trustee Powers & Administrative Provisions

  • Execution Page with State-Specific Formalities

What it handles

  • IRC § 2042-compliant trust language excluding life insurance from taxable estate

  • Crummey withdrawal rights with proper notice provisions for gift tax exclusions

  • Comprehensive trustee powers, succession, and fiduciary duty provisions

  • Policy transfer and assignment language with § 2035 three-year rule documentation

  • Minor sub-trust provisions with customizable termination ages

  • State-specific execution formalities including witness and notarization requirements

Required documents

  • Client Intake Form

    Grantor details, beneficiary information, trustee designations, funding plan, and jurisdiction specifications

    .pdf, .docx

  • Life Insurance Policy Documents

    Current policy declarations pages showing carrier, policy number, face amount, insured, and ownership details

    .pdf, .docx

Supporting documents

  • Existing Estate Plan Documents

    Current will, revocable trust, or other ILIT documents for coordination purposes

    .pdf, .docx

  • Prior Policy Assignment Forms

    Any existing ownership transfer or assignment documentation for policies being moved into the trust

    .pdf, .docx

Why teams use it

Eliminate hours of manual drafting with AI that understands the intricate tax code requirements for estate tax exclusion of life insurance proceeds

Reduce compliance risk with built-in safeguards against grantor incidents of ownership, improper trustee designations, and missing Crummey notice provisions

Produce consistent, professionally structured trust documents that coordinate seamlessly with clients' broader estate plans

Adapt quickly to different jurisdictions with state-specific execution formalities and trust law provisions

Questions

How does CaseMark ensure the ILIT complies with IRC § 2042?

CaseMark drafts explicit language surrendering all incidents of ownership from the grantor and ensures the grantor cannot serve as trustee or retain trustee-removal powers. The AI cross-references IRC §§ 2036, 2038, and 2042 requirements to produce compliant trust provisions.

Does the generated ILIT include Crummey withdrawal rights?

Yes. CaseMark automatically includes Crummey withdrawal right provisions with proper beneficiary notice procedures, ensuring contributions to the trust qualify for the annual gift tax exclusion under IRC § 2503(b).

How does the tool handle the three-year lookback rule under § 2035?

CaseMark distinguishes between existing policy transfers and new policy applications. For transferred policies, the draft prominently documents the transfer date and includes advisory language about the three-year inclusion risk. For trust-applied new policies, it confirms ab initio ownership by the trust.

Can I customize trustee succession and distribution provisions?

Absolutely. CaseMark generates a fully editable draft with customizable trustee succession mechanisms, removal procedures, distribution standards, and minor sub-trust termination ages tailored to your client's specific needs.

Does CaseMark account for state-specific trust execution requirements?

Yes. Based on the trust situs jurisdiction you specify, CaseMark incorporates the appropriate execution formalities including witness requirements, notarization, and any state-specific trust law provisions.

Can the ILIT coordinate with my client's existing estate plan?

CaseMark considers uploaded existing estate plan documents—including wills, revocable trusts, and other ILITs—to draft provisions that coordinate beneficiary designations, avoid conflicts, and ensure a cohesive overall estate plan.

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