Description: Draft Pre-Need Model proposed by National Association of Insurance Commissioners, NAIC, is analyzed from tax standpoint of both insurers, through sec. 807, and policyholders, through secs. 7702 and 7702A.

Description: Discusses the federal income tax aspects of reserves for term and secondary-guarantee UL, as regulated by XXX and AXXX.

Description: The Taxing Times Editorial Board acknowledges the invaluable contributions of our colleague, Art Schneider, who passed away in August. Throughout his career as a tax accountant, Art generously shared his time and talents to help actuaries and other tax professionals increase their understanding of insurance industry tax topics. We will miss him.

Description: This article outlines how Bermuda advanced in global tax compliance through the enactment of the Bermuda Corporate Income Tax (CIT) Act of 2023, which will take effect for tax years beginning on or after January 1, 2025. The Bermuda CIT rules incorporate key foundational definitions from the Organization for Economic Cooperation and Development’s (OECD) Pillar Two GloBE model rules, while also exhibiting significant differences from Pillar Two. The article discusses the various elections available for taxpayers, key mechanics of the CIT, and the latest administrative guidance released by the Government of Bermuda.

Description: This article briefly summarizes the history of the Passive Foreign Investment Company (PFIC) tax regime. Then it provides a detailed description of the PFIC proposed regulations issued in July of 2019.

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: One of the significant tax benefits of a life insurance contract is that, for purposes of determining the taxable amount of proceeds received under the contract on distributions or surrender,the investment in the contract includes the aggregate amount of premiums, unreduced by the cost of insurance provided IRC section 72c. IRS rules net surrender value reserves must be reduced by a YRT reserve credit.

Description: Legislation imposing new restrictions on a wide range of compensation arrangements was signed into law on October 22, 2004. The American Jobs Creation ActAJCA adds a new section 409A to the Internal Revenue Code, which imposes restrictions on funding, distributions, and elections to participate in nonqualified deferred compensation plans.

Description: Examines the Treasury Department and IRS guidance in determining whether a financial arrangement qualifies as insurance under federal tax law. It concerns the concepts of fortuity, homogeneity, and risk distribution, among others.

Description: This article begins with a brief review of the treatment of QAB charges under the Code and the guidance the Internal Revenue Service the “Service” has issued regarding the manner in which taxpayers should account for QAB charges Part I. It then describes Rev. Rul. 2005-6’s three alternatives for addressing improper accounting for QAB charges Part II. It also includes a discussion about an Alternative C closing agreement.