Why a MPI Legacy Trust?

Key benefits of a MPI Legacy Trust are the ability:

1. To purchase MPITM Plans on the lives of your descendants. (You can obtain a MPITM Plan for children and grandchildren generating income for you!)

2. For you or someone you designate to control all the MPITM Plans in your MPI Legacy Trust during your life and after you die.

3. To protect your wealth from your loved one’s creditors, lawsuits, bankruptcy, divorce and government aid qualifications.

4. To reduce federal estate taxes for you and your descendants.

5. To continue purchasing additional MPITM Plan for descendants, if desired.

6. To create wealth for generations rather than just your immediate children.

The MPITM Plan enables you to purchase a life insurance policy on yourself to create a tax free retirement income and a death benefit for your beneficiaries. However, without a MPI Legacy Trust owning the plan, there are significant limitations, such as:

  • Typically you are unable to purchase a MPITM Plan on the life of someone other than your spouse or child.
  • Upon your death, the death benefit of your MPITM Plan pays out to the named beneficiary. The beneficiary may then do whatever they wish with the death benefit.
  • Although it varies from state-to-state, life insurance proceeds are typically protected from your beneficiary’s creditors upon their initial receipt.  However, the funds then become subject to the beneficiary’s creditors, lawsuits and bankruptcy. The MPITM Plan’s proceeds can also disqualify the beneficiary from government aid programs and become subject to a beneficiary’s divorce.
  • The cash value of the MPITM Plan will count towards your Federal Estate Tax exemption amount. Everything you own that exceeds the Federal Estate Tax exemption amount will be assessed an estate tax. Currently the estate tax rate is 40%. In other words, your house, bank accounts, vehicles, MPITM Plan and everything else you own when you die will currently be taxed if it exceeds the Federal Estate Tax exemption amount. This amount is currently at $12 million in 2022. However, not only will this amount decrease to approximately $5.5 million in 2026, President-elect Joe Biden has proposed to lower this further to $3.5 million per person.
  • Upon your death, your beneficiary may spend the MPITM Plan’s proceeds and death benefit any way he or she wishes. In other words, what you have worked hard to create may be spent quickly and lavishly. The MPI Legacy Trust can help ensure that your hard earned dollars are a blessing to your loved ones rather than a curse.

Using one of the MPI Legacy Trusts can solve these problems!  If you have additional questions, please review our Frequently Asked Questions (FAQ) page.