Four years ago, Evelyn created an irrevocable life insurance trust, transferred a life insurance policy that named her as the insured to the trust, and funded it with interest-bearing bonds. Income from trust assets is used to pay the premiums on the life insurance policy. The beneficiary of the trust is Evelyn's son, Bruce. The trustee is the trust department of a bank. What is one advantage of this trust arrangement for Evelyn?     A) She avoids having all income from the trust taxed to her during her lifetime.

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Reasons for Estate Planning

Planning is a process that helps decide in advance about future activities and operations. Planning helps to draft the procedures by identifying, analyzing, and designing how to work, when to work, by whom should be done, and what has to be done. It is the primary step followed by a person, business organizations, institutions, companies, etc.