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Sec 2036, FLP, right to change life ins. beneficiary

Technical topics regarding tax preparation.
#1
Nilodop  
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Wealthy family, where father put most assets in an FLP. Father is the GP. Four children are LPs. FLP owns $10 million life insurance on GP, and $5 million on each of the LPs. GP has right to change beneficiary of all policies because he is GP. Other assets of FLP total $10 million, all liquid.

Will right to change beneficiary cause all assets of FLP to be included in estate of GP under Section 2036?
 

#2
Nilodop  
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Bump. And clarification.
Father owns 10% as GP. Children own 1% each as GPs, total 4%. Children own 86% as LPs.
 

#3
Nilodop  
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Bumpity-bump.
 

#4
Nilodop  
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Nuthin'?
 

#5
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#6
Nilodop  
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Thank you. Right on point. Not quite dispositive but shows a definite concern.
 

#7
Dennis2  
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i vote for §2042
 

#8
Dennis2  
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To elaborate the basic point of life insurance in a flp is to have the flp be the beneficiary.
 

#9
Nilodop  
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Dennis, this languished for a bit while the lawyer contemplated his navel. His conclusion is to amend the FLP agreement to remove all of the father's rights pertaining to the policy. But he is concerned that will help IRS to argue that he had those rights in the first place.

My view is that he did have the rights and this is the way to get rid of them, so ket's keep him alive for more than 3 years. :!:
 


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