IRS - Internal Revenue Service

  • During the course of....we ascertained that there were very few people within the Federal Government with an understanding of the insurance industry.  
    • A staff memo...stated: "It appears that for many years the workings of the life insurance business have been misunderstood by those at the [Internal Revenue Service and Justice Department] associated with the question.

--  Chairman  John LaFalce (D-NY)

1979 1011/1022 (Part 1) - GOV (House) - Small Business Problems with Insurance - Part 1 - [PDF-337-GooglePlay]

  • 2020 0401 - IRS - Regulations.gov -  Computation and Reporting of Reserves for Life Insurance Companies - IRS-2020-0003-0001
  • 1982 GCM - George H. Jelly 
    • Finally, we note that in private letter rulings 8116073, dated January 23, 1981, and 8132119, dated May 18, 1981, the Service indicated that the death benefit under a Universal Life policy would qualify for the exclusion under section 101.
    • We recommend that the position expressed in those rulings be reconsidered in light of this memorandum.
  • In January 1981, E.F. Hutton Life Insurance Company received a favorable ruling from the Internal Revenue Service on their universal life policy.
  • The ruling generated a great deal of interest within the insurance industry, and over the next couple of years, a large number of companies began to develop and market universal life policies.

--  William A. Stoltzmann

1985 - SOA - Variable Universal Life Insurance, Society of Actuaries - 22p

  • 818(c)
  • Corridor
  • Guideline Premiums
  • Life Insurance Tax Reserves
  • TEFRA, DEFRA, TAMRA

IRS.gov
"Your search did not return any results."
"guideline premium"
"universal life"

https://taxmap.irs.gov/taxmap2018/ts0/lifeinsurance_o_71368538.htm

  • At this point, the Baldwin-United management and the creditors have offered a settlement that would produce $170 million if a number of conditions were to be met.
  • One of the conditions is that a satisfactory solution be reached at the Internal Revenue Service with regard to the other major problem.

--  Dick<Richard> Minck -  (Executive Vice-President of the American Council of Life <ACLI> Insurance and the newly elected Secretary of the Society of Actuaries)

1984 - SOA - Changes in the Canadian Regulatory Framework for Life Insurance, Society of Actuaries - 36p

Mr. WASHBURN: There is one factor that is causing some real
new concerns in liquidations and being able to pay policyholders, and that is the Federal Priorities Statute, that was passed in, I think, 1795.

  • The Treasury Department has started to use the Federal Priorities Statute on liquidations and insolvencies, maintaining that it is not the business of insurance, and thus falls under the Federal Priorities Statute, and their usual charge, then is that anyone who makes any payments before Uncle Sam is fully paid off, whoever makes that payment is in jeopardy.
  • That would include the guaranty fund.
  • They have in some cases attached commissioners' homes.
  • The problem is that they do not feel a necessity to tell you exactly what all they are assessing under the Federal Priorities Statute; they just restrict your ability to pay.
  • Now, there have been a number of discussions with the
    Treasury Department over this.
  • We have not really proceeded - I say we, I am no longer in the business — but when I last left there was not a completion on this.

1991 0227, 0507, 0509, 0523 - GOV (Senate) - Insurance Company Solvency, aka Insurance Company Insolvencies - [PDF-369p-GooglePlay] 

  • Only by limiting practice can sanctions against unreasonable practice have any meaning.
  • Right now, anyone with a pencil and a photocopier can prepare and sign tax returns.

Enforcement.

The IRS audits the same issues time and time again.

  • Agents often avoid the difficult technical areas. 
  • I should perhaps be a little careful what I wish for, because, of course, I spend most of my life working the other side of the street.

This lack of enforcement encourages complex, hyper-technical positions, secure in the knowledge that no one is going to challenge them.

  • In 27 years, I have yet to have an agent raise a LIFO issue, an accounting methods issue, an inter-company pricing issue.
  • It is always the same: lunches and cars.

Only in arcane specialty areas which have dedicated IRS groups—for instance, insurance—do we see substantive technical areas raised.  (p17)

2003 1021 - GOV (Senate) - Tax Shelters: Who's Buying, Who's Selling, And What's The Government Doing About It? - [PDF-238p, VIDEO-?]  --  Senate-Page