Irrevocable Life Insurance Trust (ILIT) - District of Columbia

IRREVOCABLE LIFE INSURANCE TRUST (ILIT)

[TRUST NAME] — District of Columbia — [__/__/____]

Before you use this: Complete the beneficiaries and 100% distribution schedule before signing. A policy listed here is only an inventory item until an effective transfer makes the trust its owner; confirm the insurer's ownership and beneficiary records. Have tax counsel review any existing-policy transfer, premium gifts, and desired tax treatment.

1. Creation and funding

I, [SETTLOR FULL NAME], of [ADDRESS], establish the [TRUST NAME] Irrevocable Life Insurance Trust by transferring to [TRUSTEE FULL NAME], of [ADDRESS], as trustee, the cash or other property described as presently delivered in Schedule A. The trustee acknowledges receipt of that initial property and accepts the trust. The trustee shall also hold any policy or other property later effectively transferred to the trustee under these terms. This trust is governed by District of Columbia law.

The trustee is a person other than me. The trustee shall own and administer policies on the life of [INSURED FULL NAME] that are issued to or effectively assigned to the trustee, and shall hold their proceeds for the named beneficiaries. Listing an existing policy in Schedule A is an inventory, not an assignment to the trustee. I retain no power under this instrument to change policy beneficiaries, surrender or pledge a policy, borrow against it, or direct the trustee to exercise policy rights.

2. Irrevocability and beneficiaries

This trust is irrevocable. I reserve no right to revoke or amend it, receive its property or income, or direct a distribution. The beneficiaries are the identifiable persons named in Schedule B. No share may pass to me or my estate under this instrument. No later instruction from me changes a beneficiary or distribution term.

3. Policy and trust administration

The trustee may apply trust cash to policy premiums, receive dividends and policy proceeds, communicate with insurers, select available policy options, and hold, invest, sell, or distribute other trust property as needed to carry out this trust. The trustee may accept additional property but is not obliged to advance personal funds to pay premiums. If available trust property is insufficient to maintain a policy, the trustee may choose among lawful policy options after considering the beneficiaries' interests. The trustee shall keep records of policy ownership, beneficiary designations, notices, premiums, receipts, and distributions.

During the insured's life, the trustee shall hold trust property for the policy's maintenance and related expenses. No beneficiary has a right to demand a distribution before the insured's death under this instrument. After receiving the insured's death certificate, the trustee shall submit claims for proceeds payable to the trust, reserve reasonable administration costs, and distribute the remaining trust property under Schedule B. The trustee shall make no payment to the settlor or the settlor's estate under this instrument.

The trustee shall act in good faith and according to this trust and D.C. Code § 19-1308.01. The trustee shall give information, notices, and reports required by D.C. Code § 19-1308.13. The trustee may receive reasonable compensation and reimbursement of proper expenses from trust property. Nothing here excuses a breach of trust or limits liability beyond applicable law.

4. Successor trustee

If the first trustee cannot or will not serve, [FIRST SUCCESSOR FULL NAME AND ADDRESS] shall serve. If that person cannot or will not serve, [SECOND SUCCESSOR FULL NAME AND ADDRESS] shall serve. A successor accepts in a signed writing kept with the trust records. The outgoing trustee shall deliver the records and trust property to the successor. A trustee may resign by giving at least 30 days' notice to the qualified beneficiaries, the settlor if living, and all cotrustees or, if none, the next designated successor trustee; court approval is an alternative. See D.C. Code § 19-1307.05. Any removal or further appointment must follow applicable law.

5. Distribution after the insured's death

The trustee shall distribute the remaining trust property outright in the percentages in Schedule B, after paying proper trust administration expenses. A recipient must survive the insured. If a recipient does not survive, that share goes to the named alternate. If neither survives, that share is divided proportionately among the other surviving recipients or alternates. If none survives, the trustee shall distribute all remaining property to [FINAL CONTINGENT RECIPIENT FULL NAME AND ADDRESS]. The trustee may distribute in cash or in kind, using fair values to allocate shares.

6. Execution

I intend to create this irrevocable trust and have delivered the initial property listed in Schedule A to the trustee.

Settlor signature: ______________________________ Date: [__/__/____]

Printed name: [SETTLOR FULL NAME]

I acknowledge receipt of the initial trust property and accept the trusteeship under these terms.

Trustee signature: ______________________________ Date: [__/__/____]

Printed name: [TRUSTEE FULL NAME]

Schedule A — initial property and policies

Property delivered with this instrument: [IDENTIFIABLE CASH OR OTHER PROPERTY; AMOUNT AND DELIVERY METHOD]

Schedule B — beneficiaries and residue

Shares must total 100%. Complete the alternate and final contingent recipient fields before signing.

Final contingent recipient: [FULL NAME AND ADDRESS]