|
AALU Monitoring Proposed IRS Rule (833 words) |
 | AALU notes that under Section 817(h) of the tax code, the inside buildup of a variable contract that is based on a segregated asset account is taxable during any period during which the segregated asset account investments are not adequately diversified. |
| In addition, AALU notes, for variable annuity, endowment and life insurance contracts, the "look through" rule applies if the two conditions noted above are met--that is, all the beneficial interests in the investment company are held by one or more insurance companies and public access is available only through the purchase of a variable contract. |
| AALU says this exception to the "look through" rule clearly has become an inconvenience to the IRS in its drive to deny tax-deferral treatment to income earned on variable contracts invested in hedge funds. |
| AALU and NAIFA Urge Revision of Proposed Split-Dollar Regs (6597 words) |
| According to Schiff and Koob, the AALU and the NAIFA are concerned that the proposed changes will impose current taxation on the equity build-up in a life insurance contract. |
| [48] AALU and NAIFA believe that the following changes with respect to either the life insurance contract or the split-dollar life insurance agreement (both of which, at a minimum, must be regarded as integral parts of the arrangement) should not be deemed to be "material" for purposes of the effective date rules. |
| [61] AALU and NAIFA request that the Proposed Regulations be clarified to specify which agreements and/or documentation constitute an "arrangement" for purposes of the effective date provisions in the Proposed Regulations and in Notice 2002-8. |
Feeds |
Contact