Showing posts with label IRS Penalties. Show all posts
Showing posts with label IRS Penalties. Show all posts
Understanding IRC Sections 419(e) and 419A(f)(6) Plans
IRC Sections 419(e) and 419A(f)(6) Plans
For years life insurance agents and others have been selling ways to deduct life insurance in welfare benefit plans. For years the IRS has been disallowing most of these plans on audit.
In Notice 2007-83, the IRS identified certain trust arrangements involving cash value life insurance policies, and substantially similar arrangements, as listed transactions. The IRS also issued related Revenue Ruling 2007-65 to address situations where an arrangement is considered a welfare benefit fund but the employer's deduction for its contributions to the fund is denied in whole or in part for premiums paid by the trust on cash value life insurance policies.
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