Life Insurance

Category Archives

5 Take-Aways from IRS Proposed Regs on 199A Deduction for Pass-Throughs

August 17, 2018by Lina Storm, CLU®, ChFC®, MBA in Life Insurance

The IRS issued proposed regulations—all 189 pages– to clarify some of the complexities of its new §199A rule established under the 2017 Tax Act (Tax Act). Practitioners such as CPAs and attorneys, as well as the American public, can make comments over a 45-day period, after which the IRS will assess the comments and finalize the rules.

For a brief overview of §199A, see Highland Capital Brokerage blog articles 2017 Tax Act: An Overview Part 1 and 2017 Tax Act: An Overview Part 2

Although it will take time to digest these proposed regulations, there are 5 take-aways we can share right now. Stay tuned for a more in-depth summary.

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Top 3 Reasons to Meet with Clients NOW

August 14, 2018by Lina Storm, CLU®, ChFC®, MBA in Life Insurance

We are over halfway through 2018 and financial advisors are well advised to start scheduling appointments post-haste with their upper net worth and higher income clients to discuss year-end planning affected by the 2017 Tax Act rules.

Here are the Top 3 Reasons to schedule client meetings right now:

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4 Ways to Pay Premiums Using A Client’s Own Assets

August 7, 2018by Lina Storm, CLU®, ChFC®, MBA in Life Insurance

Many high net worth clients need liquidity for which life insurance is the solution. However, when it comes to paying the premium, cash is required.  Often, clients, regardless of wealth, have a hard time giving away large amounts of cash, especially when they consider that they will not see it again.

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The Skinny on SALT Under Tax Reform

July 24, 2018by Lina Storm, CLU®, ChFC®, MBA in Life Insurance

Tax practitioners aren’t the only ones grappling with how to navigate the new complex rules of the 2017 Tax Act. State officials of high-tax states, too, have been busy considering options to help mitigate the effects of the limitations placed on the federal SALT (state and local taxes) deduction, which is capped at $10,000 under the new law.

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6 Takeaways from Cahill Tax Court Case: Intergenerational Split Dollar

July 17, 2018by Lina Storm, CLU®, ChFC®, MBA in Estate Planning, Life Insurance

The recent Estate of Cahill tax court case gives us a glimpse into the court’s view of intergeneration split dollar arrangements (GSD). In particular, the court focused on, among other things, the valuation of the loan repayment for estate tax purposes, as well as the appearance of the transaction as a vehicle for below market transfers to family members. Although the tax court did not issue a summary judgement and the case will now move to trial for a decision, the comments of the tax court are telling.

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Premium Financing

July 10, 2018by Lina Storm, CLU®, ChFC®, MBA in Financial Planning, Life Insurance

For many years Premium Financing was used by the Property & Casualty industry to allow employers to finance hefty commercial liability premiums. Fast forward to the last two decades and Premium Financing has evolved to fund a client’s large life insurance needs.

Premium Financing refers to the funding of premiums through a third-party lender, like a bank.

Clients who need a large life insurance policy to create liquidity for estate planning, wealth transfer or business succession may consider establishing a loan for the annual premiums through a commercial lender.  This type of loan is similar to other loans: the arrangement requires approvals from both the bank and the insurance company issuing the policy, a fair market rate of interest is charged, and collateral in the form of the life insurance policy and additional personal assets must be posted.

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When Does A Non-Qualified Benefit Plan Make Sense?

July 3, 2018by Lina Storm, CLU®, ChFC®, MBA in Financial Planning, Life Insurance

Both business owners and executives can benefit from non-qualified benefit plans. When considering which options make the most sense, the questions revolve around:

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