Crummey notice is the written communication sent to beneficiaries of a trust informing them of their temporary right to withdraw recent contributions, typically equal to the annual exclusion amount. Providing this notice and a genuine opportunity to withdraw is what turns trust contributions into present-interest gifts eligible for the annual gift-tax exclusion, even though beneficiaries usually choose not to withdraw. Crummey notices are essential in life insurance trusts that receive premium gifts and must be documented carefully for tax purposes.

Advisors and trustees implement Crummey notices each time contributions are made to an irrevocable life insurance trust or similar structure relying on annual exclusion gifts. Notices must specify the amount, time window, and withdrawal mechanics and be sent to all beneficiaries with withdrawal rights. Trustees retain copies and evidence of delivery in trust files. CPAs may request documentation during audits or estate-tax examinations. Understanding Crummey notices helps advisors explain to clients why seemingly technical letters play a crucial role in preserving the tax efficiency of insurance-funded wealth-transfer strategies.