Research & Resources

• IRS Provide Guidance on Closing Agreements
• On January 26, 2007, the Internal Revenue Service (IRS) released Notice 2007-15 which provides guidance regarding closing agreements under sections 7702, 7702A, and 817(h). The notice requests comments from taxpayers on a number of issues. These comments may be very material to the manner in which the IRS processes these closing agreements in the future. The Notice includes four model closing agreements, in draft form, that the Service anticipates using.
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• IRS released Notice 2006-95
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• IRS Final Regualtion for Determining Attained Age Under Section 7702

Treasury and IRS Provide Guidance on Attained Age Determination: The Department of Treasury and the IRS have issued final regulations providing guidance on determining an insured's attained age for purposes of testing a policy's compliance with IRC section 7702. Guidance is provided for both single and multiple life attained age determination. The specifics of the attained age guidance are found in added section 1.7702-2.

2001 CSO Implementation Under IRC Sections 7702 and 7702A
The Taxation Section established the 2001 CSO Maturity Age Task Force to propose methodologies that would be actuarially acceptable under Sections 7702 and 7702A of the Code for calculations under contracts that do not provide for actual maturity before age 100. These recommendations were originally reported in the May 2006 issue of Taxing Times.

• Supplement to Life Insurance and Modified Endowments, Under Internal Revenue Code Sections 7702 and 7702A

Determining the "Actuarial Present Value" of Certain "Additional Benefits" Under Treas. Reg. Section 1.401(a)(9)-6, Q&A-12

Read the Taxation Section's Required Minimum Distribution Working Group Report examining types of benefits covered under Treas. Reg. Sec. 1401(a)(9)-6, Q&A-12 as well as possible assumptions and methods for calculating the actuarial present values of additional benefits provided under an annuity contract.