Description: Notice 2004-611 is the latest in a series of administrative pronouncements from the Internal Revenue Service related to the appropriate mortality assumptions to be used in computing the definitional limitations under Internal Revenue Code Section 7702 and the seven-pay limitation under the Section 7702A modified endowment rules.

Description: The United States district court for the Southern District of Ohio recently issued its opinion in American Financial Group and Consolidated Subsidiaries v. United States. The issue in the case as framed by the Internal Revenue Service IRS was whether Actuarial Guideline XXXIII AG 33 applies retroactively or prospectively to the calculation of reserves for deferred annuity contracts. This article is a discussion of this opinion.

Description: Provides information on Section 7702 mortality requirements, the implications of the adoption of the 2017 CSO tables and the need for IRS guidance.

Description: This article addresses the scope of reserve valuation rules that compute or estimate reserves “on the basis of recognized mortality or morbidity tables, and assumed rates of interest.”

Description: The American Council of Life Insurers provides an update on recent tax-related ACLI activity. Topics in this issue include (1) the NAIC's Principle-Based Reserves (PBR) Review Working Group and its exposed revisions to the Annual Statement Blanks; (2) ongoing communications with the Internal Revenue Service and Treasury to seek published guidance on PBR; (3) an update on tax reform activity in Congress; (4) the framework for change issued by the NAIC's Variable Annuities Issues (E) Working Group; and (5) the ERISA Advisory Council's development of model notices and disclosures for pension risk transfers.

Description: Article examines a proposed amendment to the MAP-21 Act that would have changed a number of tax requirements regarding so-called life settlements.

Description: This article discusses the implications of a principle-based reserve PBR system with respect to federal income taxation of life insurance companies, particularly with respect to tax reserves and their deductibility for tax purposes. The article discusses potential problems with existing tax rules for reserve deduction, what courses of action the IRS could take, and suggestions for design features of a PBR approach that would make it more consistent with current tax rules. Life insurance product tax implications are also discussed.

Description: The article addresses the safe harbor guidance provided in Notice 2016-63 for 2017 CSO contracts satisfying the section 7702 reasonable mortality requirements

Description: This update column from ACLI addresses the 2020 year-end spending and relief package with specific emphasis on its effect on the life insurance industry

Description: A discussion of new IRS rulings with respect to the taxation of life settlement transactions.