Irrevocable Life Insurance Trust     An irrevocable trust is one in which the grantor completely gives up all rights in the property transferred to the trust, and retains no rights to revoke, terminate or modify the trust in any material way. When such a trust holds a life insurance policy, usually on the grantor's life, it is an irrevocable life insurance trust.     If Crummey powers are granted to the beneficiaries, it may also be referred to as a "Crummey trust" after a famous court case of the same name [Crummey v. Comm’r, 397 F.2d 82 (9th Cir. 1968)].     Typically, these trusts are used in estate planning to accomplish four primary objectives:     •           to help meet the liquidity needs of the grantor's estate, •           to avoid the estate taxation of the death proceeds, •           to help provide for the income needs of survivors after liquidity costs have  been satisfied, and •           to shelter property from creditors at death.       Features of the Irrevocable Life Insurance Trust     The irrevocable life insurance trust is created during the grantor's life. The beneficiaries of the trust are often family members of the grantor—spouse, children, grandchildren, spouses of children and grandchildren.     The trust is funded with a life insurance policy on the grantor. This may be an existing policy which the grantor gifts to the trust, or it may be a new policy that the trustee acquires with cash transferred to the trust from the grantor.     The trustee is usually given the discretion to pay premiums. If premiums may be paid from trust income, then the trust generally is considered to be a grantor trust. A grantor trust is ignored for income tax purposes, which, in some estate planning circumstances, is a way to ensure that growth to future generations is not diminished by income taxes.     Usually, the grantor makes annual transfers of cash to the trust so that the trustee can pay the premiums. Of course, these annual transfers are gifts. Where the trust beneficiaries cannot begin to "enjoy" the policy until the grantor-insured dies, the gifts would ordinarily be future interests.   That means no gift tax annual exclusion is available to shelter the annual cash transfers from the federal gift tax.     The IRS concluded in one ruling that an employer's payment of monthly premiums for group term life insurance held in an employee's irrevocable trust qualified for the gift tax annual exclusion [Rev. Rul. 76-490, 1976-2 C.B. 300; see also G.C.M. 37451].     The premiums were considered a present interest because, under the terms of both the group insurance policy and the trust, death proceeds were payable to the trust beneficiary immediately upon the death of the insured.     When the trust and policy terms provide that the death proceeds are to be held in trust upon the insured's death rather than be paid immediately to the beneficiary, the annual premium transfers would be gifts of future interests unless one or more Crummey powers are used to convert them to present interests.