Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Preserving family wealth with an estate freeze Installment Sale to a Grantor Trust

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN The Voya ™ Life Companies and their agents and representatives do not give tax or legal advice. This information is general in nature and not comprehensive, the applicable laws change frequently and the strategies suggested may not be suitable for everyone. Clients should seek advice from their tax and legal advisors regarding their individual situation. These materials are not intended to and cannot be used to avoid tax penalties and were prepared to support the promotion or marketing of the matter addressed in this document. You should seek advice from an independent tax advisor. Life insurance products are issued by ReliaStar Life Insurance Company (Minneapolis, MN), ReliaStar Life Insurance Company of New York (Woodbury, NY) and Security Life of Denver Insurance Company (Denver, CO). Within the state of New York, only ReliaStar Life Insurance Company of New York is admitted, and its products issued. Disclosures

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Three questions Do you have assets whose future growth may create an estate tax problem and which you would like to preserve intact for your children or grandchildren?

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Three questions Do you have assets whose future growth may create an estate tax problem and which you would like to preserve intact for your children or grandchildren? Do your insurance needs call for premiums that exceed the available annual exclusions for potential “Crummey” beneficiaries?

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Do you have assets whose future growth may create an estate tax problem and which you would like to preserve intact for your children or grandchildren? Do your insurance needs call for premiums that exceed the available annual exclusions for potential “Crummey” beneficiaries? Would you like to reduce some of the long-term risks associated with premium financing or private split-dollar? Three questions

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Is there a way to potentially “freeze” the value of my estate so that I don’t pay gift or estate taxes on future asset growth?

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Is there a way to potentially pre-fund an insurance trust so I don’t have to worry about keeping premium levels within my annual gift exclusions?

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Is there a way to potentially provide my insurance trustee with resources to make an early exit from premium financing, private split-dollar, or other similar strategies?

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Yes!

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN What is an “Installment Sale to a Grantor Trust?” –It’s a potential estate “freeze” technique where high- growth assets are transferred to an irrevocable grantor trust in exchange for a note obligating the trustee to make payments on an agreed upon schedule.

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN How does the strategy work? The Installment Sale to a Grantor Trust has 6 steps: #1: Create a Grantor Trust

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN How does the strategy work? The Installment Sale to a Grantor Trust has 6 steps: #1: Create a Grantor Trust #2: Pre-Fund Trust

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN How does the strategy work? The Installment Sale to a Grantor Trust has 6 steps: #1: Create a Grantor Trust #2: Pre-Fund Trust #3: Assets transferred to Trust in exchange for Promissory Note

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN How does the strategy work? The Installment Sale to a Grantor Trust has 6 steps: #1: Create a Grantor Trust #2: Pre-Fund Trust #3: Assets transferred to Trust in exchange for Promissory Note #4: Trust makes payments on Note

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN How does the strategy work? The Installment Sale to a Grantor Trust has 6 steps: #1: Create a Grantor Trust #2: Pre-Fund Trust #3: Assets transferred to Trust in exchange for Promissory Note #4: Trust makes payments on Note #5: Grantor pays income taxes for Trust

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN The Installment Sale to a Grantor Trust has 6 steps: #1: Create a Grantor Trust #2: Pre-Fund Trust #3: Assets transferred to Trust in exchange for Promissory Note #4: Trust makes payments on Note #5: Grantor pays income taxes for Trust #6: After death, assets pass to Beneficiaries tax-free according to Trust terms How does the strategy work?

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Estate “Freeze” – Future asset growth may be removed from the grantor’s estate. Flexibility – You can structure the note payments any way you want (so long as the terms are commercially reasonable). No Inclusion on Early Death – Unlike a GRAT, the installment sale works even if the grantor dies before the end of the note’s term; only unpaid principal is included in the grantor’s estate. Exit Strategy – An installment sale can potentially provide the trust with funds to get out of premium financing or private split-dollar arrangements. Potential advantages of the Installment Sale

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN Pre-Funding Penalty – If you don’t already have a grantor trust, you may have to use some of your lifetime gift & estate tax exemption to fund the trust at 10% of the total value of the sale. Performance Risk – The installment sale technique only works if the asset used grows at a higher rate than the interest required for the note. Regulatory Risk – Unlike a GRAT (which is defined by by Section 2702 and regulations thereunder), the installment sale using a defective trust relies on rulings and court cases. Potential disadvantages of the Installment Sale

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN John & Jane Jones are married, both age 55, and own $2 million worth of stock in the highly successful Widget Corp. John & Jane expect shares of Widget Corp. to continue increasing in value at an annual rate of 10%. They are willing to give up ownership of the stock in exchange for an income stream. They are also willing to use a portion of their lifetime gift exemptions to move future asset growth out of their estates. The Installment Sale in action: John & Jane Jones* * The hypothetical results are for illustrative purposes only and should not be deemed a representation of past or future results. This example does not represent any specific product, nor does it reflect sales charges or other expenses that may be required.

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN John & Jane create a grantor trust and pre-fund the Trust with $200,000 worth of shares in Widget Corp. John & Jane Jones* * The hypothetical results are for illustrative purposes only and should not be deemed a representation of past or future results. This example does not represent any specific product, nor does it reflect sales charges or other expenses that may be required.

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN John & Jane create a grantor trust and pre-fund the Trust with $200,000 worth of shares in Widget Corp. John & Jane then transfer the remaining $1.8 million of Widget shares to the Trust in exchange for a 10-year note with interest at the rate of 3.27%.** John & Jane Jones* * The hypothetical results are for illustrative purposes only and should not be deemed a representation of past or future results. This example does not represent any specific product, nor does it reflect sales charges or other expenses that may be required. ** This was the long-term AFR published by the IRS for June, 2014.

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN John & Jane create a grantor trust and pre-fund the Trust with $200,000 worth of shares in Widget Corp. John & Jane then transfer the remaining $1.8 million of Widget shares to the Trust in exchange for a 10-year note with interest at the rate of 3.27%.** The Trust makes annual principal and interest payments of $185,886 for 10 years. John & Jane Jones* * The hypothetical results are for illustrative purposes only and should not be deemed a representation of past or future results. This example does not represent any specific product, nor does it reflect sales charges or other expenses that may be required. ** This was the long-term AFR published by the IRS for June, 2014

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN What have we potentially accomplished? Estate Freeze: At the end of 10 years, John & Jane have moved over $1.6 million outside of their estates. –While John & Jane have each used a portion of their lifetime gift exemptions, no transfer taxes have been paid and the use of a grantor trust makes the sale income-tax neutral.

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN What have we potentially accomplished? Estate Freeze: At the end of 10 years, John & Jane have moved over $1.6 million outside of their estates. –While John & Jane have each used a portion of their lifetime gift exemptions, no transfer taxes have been paid and the use of a grantor trust makes the sale income-tax neutral. Funded Life Insurance Trust: Assets inside the Trust can be used to purchase life insurance on John and/or Jane to create a larger inheritance for their family. –Unlike a traditional life insurance trust, no annual exclusions will be needed for the Trust to purchase life insurance.

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN What have we potentially accomplished? Estate Freeze: At the end of 10 years, John & Jane have moved over $1.6 million outside of their estates. –While John & Jane have each used a portion of their lifetime gift exemptions, no transfer taxes have been paid and the use of a grantor trust makes the sale income-tax neutral. Funded Life Insurance Trust: Assets inside the Trust can be used to purchase life insurance on John and/or Jane to create a larger inheritance for their family. –Unlike a traditional life insurance trust, no annual exclusions will be needed for the Trust to purchase life insurance. Exit Strategy: John & Jane have supplied the Trustee with assets which can be used to “exit” premium financing or private split-dollar arrangements.

Do not put content on the brand signature area ©2014 Voya Services Company. All rights reserved. CN To learn more about Installment Sales, talk to your Voya representative.