A Boutique Trusts & Estates Law Firm

Life Insurance Trusts • Baltimore Trust Lawyers

At Sims & Campbell, we often recommend insurance trusts as a way to keep insurance proceeds out of the taxable estate. If you think that you could benefit from an insurance trust, please feel free to contact us to discuss whether an insurance trust would be a useful tool in your estate plan.

Many people do not realize that life insurance proceeds are often subject to estate tax at the death of the insured. Ownership of a large life insurance policy, even an inexpensive term policy, can have unintended adverse estate tax consequences if the policy’s death benefit, combined with the insured’s other assets, exceeds the $3,000,000 Maryland or $5,490,000 federal estate tax exemption limits.

Transferring ownership of life insurance policies to a life insurance trust is a relatively easy way to keep the life insurance proceeds out of your taxable estate at death. A life insurance trust is an irrevocable trust which is both the owner and beneficiary of one or more life insurance policies. Upon the death of the insured, the trustee invests the insurance proceeds and administers the trust for one or more beneficiaries.

Proper ownership of life insurance is important if the insurance proceeds are to escape estate taxation. If the policy is owned by the insured, the proceeds will be subject to estate tax. (This assumes that the aggregate value of the estate plus the life insurance is large enough to be subject to estate taxes.) To avoid estate taxation, some insureds name a child, spouse or other beneficiary as the owner of the policy.

There are, however, two drawbacks to having insurance proceeds paid outright to a child, spouse or other beneficiary.

  • Doing so may be inconsistent with the insured’s wishes or the best interests of the beneficiary, who might be a minor or lacking in financial sophistication and unable to invest the proceeds wisely.
  • The insurance proceeds will be included in the beneficiary’s taxable estate at his or her subsequent death.

The solution to both problems is usually an irrevocable life insurance trust. It is best if an insurance trust is created prior to the purchase of an insurance policy so that the trust can purchase the policy directly. If the insured transfers an existing policy to the insurance trust, the transfer will be included in the insured’s taxable estate if the insured dies within three years of making the transfer.

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For Immediate Release

Contact: Jane Frankel Sims

410-828-7775

Contact: Frank Campbell

410-263-1667

Sims & Campbell Estates and Trusts

Frankel Sims Law and Holden & Campbell
Merge to Form Sims & Campbell

Firm will offer comprehensive Trusts & Estates services through offices in Towson and Annapolis

TOWSON, Md. (April 26,2019)  Frankel Sims Law and Holden & Campbell have jointly announced the merger of their firms to create a boutique Trusts & Estates law firm providing comprehensive services in the fields of Estate Planning, Estate Administration, Trust Administration and Charitable Giving. The combined firm will be named Sims & Campbell and have offices in Towson, Md. and Annapolis, Md.  Jane Frankel Sims and Frank Campbell will lead and hold equal ownership stakes in the firm.

Sims & Campbell will have 9 attorneys and 15 legal professionals that handle every facet of estate and wealth transfer planning, including wills, revocable living trusts, irrevocable trusts, estate and gift tax advice, and charitable giving strategies.  The firm will focus solely on Trusts & Estates but will serve a wide range of clients, from young families with modest resources to ultra-high net worth individuals.  This allows clients to remain with the firm as their level of wealth and the complexity of related estate and tax implications change over time. 

“By joining forces, we have expanded our footprint to conveniently serve clients in Maryland, D.C. and Virginia” said Jane Frankel Sims.  We are seeing some of the greatest wealth transfer in our country’s history, and we want to continue to be on the leading edge of helping our clients maintain and enhance their family’s wealth.  In addition, we aim to serve our clients for years to come, and the new firm structure will allow Sims & Campbell to thrive even after Frank and I have retired.”    

“Jane and I have always admired each other’s firms and recognized the need to provide even greater depth and breadth of focused expertise to help families amass and protect their wealth from generation to generation,” said Frank Campbell.  “Now we have even greater capabilities to make a real difference for our clients.” 

The Sims & Campbell Towson office is located at 500 York Road, on the corner of York Road and Pennsylvania Avenue in the heart of Towson.  The Annapolis office is currently located at 716 Melvin Avenue, and is moving to 181 Truman Parkway in August, 2019.  For more information, visit www.simscampbell.law.