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May 9, 2023

IRS issues proposed regulations on applying transfer-for-valuable-consideration rules in certain life insurance transactions

The IRS has provided guidance (REG-108054-21) on how to apply the transfer-for-valuable-consideration rules, and associated information-reporting requirements for reportable policy sales of interests in life insurance contracts, to (1) exchanges of life insurance contracts qualifying for nonrecognition of gain or loss and (2) certain acquisitions of interests in life insurance contracts in transactions that qualify as corporate reorganizations. A Tax Alert is forthcoming.

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor