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Because the ILIT is an irrevocable trust, you permanently lose control of whatever is in the trust. That's what keeps whatever is in it out of your estate. Of course you determine what happens in the trust document.

So you have 2 options here. Either begin doing your research and find out as much as you can about tax and accounting information, as it pertains to your business and state. Or hire a professional accountant.

8-Negligence or fraud in reporting- There is a 20% penalty for negligent reporting and a 75% penalty for under reporting income with fraudulent intent. The IRS chooses whether it's negligence or fraud. Yikes.

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