Income Strategy

Millionaire Retirement Strategy - Estate Tax Planning and Tax-Free Income

Tax-free retirement strategies tailored for High Net Worth ($1M+ assets). Income range: $250,000 - $5,000,000+.

Retirement Landscape for High Net Worth ($1M+ assets)

Federal estate tax exposure above $13.61 million exemption (2024), scheduled to drop to approximately $7 million in 2026. Large IRA/401(k) balances create significant RMD tax liability. State estate tax in 12+ states. Investment income subject to 3.8% NIIT. Legacy planning concerns.

Common Retirement Challenges

Challenges that High Net Worth ($1M+ assets) typically face

How IUL Solves These Problems

For millionaires, IUL addresses both income tax and estate planning. Large IUL policies held in an Irrevocable Life Insurance Trust (ILIT) remove the death benefit from the taxable estate. Policy loans provide income-tax-free retirement income without triggering RMDs or NIIT. For those with large traditional account balances, IUL-funded Roth conversions can shift wealth to tax-free status.

The Key Advantage: IUL policy loans are not considered taxable income at the state or federal level. This means no IRMAA triggers, no Social Security taxation thresholds crossed, and no impact on means-tested benefits.

Key Strategies for High Net Worth ($1M+ assets)

ILIT-owned IUL for estate tax-free wealth transfer

1 Roth conversion of traditional accounts to reduce future RMD burden

2 Charitable Remainder Trust (CRT) for capital gains deferral

3 Donor-Advised Fund for charitable giving and tax deductions

4 Annual exclusion gifts ($18,000 per recipient in 2024)

5 Spousal Lifetime Access Trust (SLAT) for estate reduction

Get a Retirement Plan Designed for High Net Worth ($1M+ assets)

Work with an independent IUL advisor who understands the specific retirement challenges and opportunities for your situation.

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