Tax Facts

154 / Is there a gift for gift tax purposes when a grantor transfers a life insurance policy to an irrevocable trust in which the grantor has no interest?

Updated: October 02, 2024 at 01:55 PM
Yes.1 The value of the gift will be the fair market value of the policy as of the date of the transfer ( Q 119). There is no gift if the trust is revocable.2 An employee’s assignment of a group life policy to an irrevocable trust was held not to be a taxable gift because the policy had no ascertainable value ( Q 119, Q 159, Q 212).3




1.     Treas. Reg. § 25.2511-1(h)(8).

2.     Treas. Reg. § 25.2511-2(c).

3.     Rev. Rul. 76-490, 1976-2 CB 300.


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