A Whole New GameA Whole New Game
As with split dollar, the Treasury Department and the Internal Revenue Service have proven they understand what is going on in the life insurance marketplace and when they see something abusive know how to stop it. On Feb. 13, the Treasury Department and Internal Revenue Service issued guidance on the valuation of life insurance policies that thwarts two popular strategies using life insurance in
April 1, 2004
Charles L. Ratner, national director, insurance counseling, Ernst & Young LLP, Cleveland, Ohio
As with split dollar, the Treasury Department and the Internal Revenue Service have proven they understand what is going on in the life insurance marketplace and — when they see something abusive — know how to stop it. On Feb. 13, the Treasury Department and Internal Revenue Service issued guidance on the valuation of life insurance policies that thwarts two popular strategies using life insurance in executive compensation and estate planning. One is known as the “pension rescue;”1 I call the other “the alchemist's dream.”
Bottom line for clients and planners: There are now fewer ways to transfer wealth on the cheap. Parties already involved in t...
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