ITB 12-12: S. 2048 - New reporting requirements for life insurance settlement transactions

Insurance Tax Bulletin
On January 31, 2012, Senator Robert P. Casey (D-PA) introduced S.2048, a bill to amend the Internal Revenue Code of 1986 to clarify the tax treatment of certain life insurance contract transactions, (the "Bill"), which sets down reporting requirements for life insurance settlement transactions and clarifies the tax basis of life insurance contracts. The Bill contains three sections one of which adds new Code section 6050X and conforming amendments, the second section clarifies rules to determine the tax basis of life insurance contracts, and the third one provides an exception to the transfer for valuable consideration rules.


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