Concerning use of funded irrevocable life insurance trust

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All the following statements concerning the use of a funded irrevocable life insurance trust are correct EXCEPT:

A)The income earned on the trust property is taxable to the trust creator if the income is used to pay premiums on a life insurance policy on the life of the creator.

B) The cash value of a policy on the life of the trust creator’s daughter is excluded from the creator’s gross estate for federal estate tax purposes.

C) The creation and funding of the trust have no gift tax implications.

D) The creator loses control over both the funding property and the life insurance policy.

Reference no: EM13930177

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