The New Golden Handcuffs

How a split-dollar strategy allows deferred compensation for small- to mid-sized companies With all the changes to executive benefit arrangements in the past decade, can a smallto medium-sized employer on a budget provide a meaningful benefit to key employees to ensure loyalty and compete with larger corporations? The answer is a resounding “yes.” The passage … Continue reading

Use Caution When It Comes To Backdating Policies

Life insurance policies are priced on the age of the insured — the lower that age, the lower the price. Consequently, the practice of backdating policies has developed as a way of keeping down the cost of coverage, and one year can make a significant difference in some cases. Besides obtaining a lower price, another … Continue reading

Transferring Ownership Of Life Insurance

What is the value of a life insurance policy when it is transferred from one policyowner to another policyowner? Are there guidelines we can rely on to determine the value for income tax purposes, gift tax purposes or sale purposes, depending on the facts of the case? These are questions that I am frequently asked. … Continue reading

Discounted Private Split-Dollar: Does the Risk Outweigh the Reward?

The split-dollar hybrid could be a great way to get around taxes — or get into trouble with the IRS. Once a great idea reaches the tipping point, there are two possible outcomes with potentially negative effects. First, profits decrease significantly as competition drives down the exclusivity premium paid by early adopters. Second, the strategy … Continue reading