Fairfax Virginia Irrevocable Funded Life Insurance Trust with Beneficiaries' Crummy Right of Withdrawal and Survivorship Rider: A Comprehensive Overview In Fairfax, Virginia, individuals and families seeking to protect their assets and ensure financial security for their loved ones often consider the Fairfax Virginia Irrevocable Funded Life Insurance Trust (IIT). This trust is specifically structured to combine the features of a life insurance policy with the benefits of a trust, offering unique advantages for estate planning. 1. First to Die Policy with Survivorship Rider: One type of Fairfax Virginia IIT that serves as a popular estate planning tool is the First to Die Policy with Survivorship Rider. This policy covers two individuals, typically spouses, and pays out the death benefit after the death of the first insured individual. The survivorship rider then ensures the continued coverage of the surviving insured individual to provide further financial security. 2. Beneficiaries' Crummy Right of Withdrawal: The Fairfax Virginia IIT incorporates a unique feature known as the "Crummy Right of Withdrawal." This provision allows beneficiaries to receive annual withdrawal rights for a limited period, typically 30 days, after contributions are made to the trust. By utilizing this right, beneficiaries can avoid potential gift tax consequences associated with the irrevocable transfer of assets. 3. Medicaid Planning: Another variant of the Fairfax Virginia IIT involves Medicaid planning, where individuals aim to protect their assets from being depleted by potential future nursing home and long-term care costs. By transferring ownership of a life insurance policy to an IIT, individuals can safely set aside funds that will be exempt from Medicaid resource requirements, ensuring financial stability for their families. 4. Generation-Skipping Transfer Tax Mitigation: An additional type of Fairfax Virginia IIT focuses on mitigating the generation-skipping transfer (GST) tax. GST tax applies when assets are transferred to beneficiaries who are at least two generations younger than the individual transferring the assets. By employing an IIT and incorporating GST tax-exempt life insurance policies, individuals can minimize the tax burden on future generations. 5. Charitable Remainder Trust: For individuals interested in philanthropy, the Fairfax Virginia IIT can be structured as a Charitable Remainder Trust (CRT). This variation allows the designated beneficiaries to receive annuity payments for a specified period, followed by the remaining trust assets being donated to a charitable organization. In conclusion, the Fairfax Virginia Irrevocable Funded Life Insurance Trust with Beneficiaries' Crummy Right of Withdrawal and Survivorship Rider offers individuals and families an array of options to safeguard their assets and ensure financial security for their loved ones. Whether through the First to Die Policy with Survivorship Rider, Medicaid planning, GST tax mitigation, or a Charitable Remainder Trust, this trust serves as a crucial tool for effective estate planning in Fairfax, Virginia.