The seminar will provide an in-depth review of the federal income taxation rules related to life insurance products, focusing on the definition of life insurance under section 7702 and the modified endowment rules under section 7702A of the Internal Revenue Code. The basic tests, including the guideline premium/cash value corridor test and the cash value accumulation test under section 7702 will be addressed, as well as the 7-pay test under section 7702A. The calculation of the actuarial requirements for compliance will be explained, including the treatment of changes in policy coverage and terms. The seminar is presented by the authors of the Society of Actuaries textbook “Life Insurance and Modified Endowments under Internal Revenue Code Sections 7702 and 7702A”. It will provide an introduction to the tax requirements for qualification as life insurance under section 7702 the Internal Revenue Code, as well as the modified endowment rules under section 7702A. Educational Objectives: Attendees also gain knowledge and key insights on the federal income tax rules applicable to the design and administration of life insurance contracts. Compliance with the section 7702 and 7702A rules is a fundamental element to the tax treatment of life insurance contracts from the perspective of the policyholder. Failure to meet the definition of life insurance both at issue and on an ongoing basis can create significant issues for a life insurance company. Target Audience: Product development actuaries, tax actuaries and others who are interested in product design as well as tax risk. Level of Difficulty: Moderate
Posted on: Wed, 11 Sep 2013 04:50:02 +0000
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