Split-Dollar Insurance

By: Martin M. Shenkman, CPA, MBA, JD

Split-dollar is an arrangement under which the death benefit and the costs of life insurance are divided/shared between two different taxpayers. Split-dollar can be arranged between a corporation and its executive in a manner that provides for an insurance benefit to the employee; between a shareholder and corporation to provide a benefit to the shareholder; or between an individual and a family trust to provide a gift tax benefit, as examples. Regulations were issued in 2003 that govern most split-dollar arrangements occurring after the effective date of those regulations. Under these rules split-dollar arrangements are treated for tax purposes under either an economic benefit or a loan regime.

Our Consumer Webcasts and Blogs

Subscribe to our email list to receive information on consumer webcasts and blogs, for practical legal information in simple English, delivered to your inbox. For more professional driven information, please visit Shenkman Law to subscribe.

Ad Space