Using Private Placement Insurance Products to Achieve Tax Efficiency for High Net Worth Investors
Author: Gerald R. Nowotny.
Source: Volume 29, Number 04, Summer 2012 , pp.49-73(25)
< previous article |next article > |return to table of contents
Abstract:
Although no one can predict what Congress will do at any point, it is quite likely we will see higher income tax rates in the near future, along with an increase in federal estate tax rates and a decrease in available income tax deductions. For high net worth investors, private placement insurance contracts could be the solution to tax planning in an unfriendly tax environment. These investment vehicles allow for investment customization and provide for the possibility of stronger and more consistent investment performance, while also offering attractive tax benefits. The author explains several options within the realm of private placement insurance, and analyzes the related investment and tax planning issues.Keywords: PPLI; tax-advantaged investment; estate planning; hedge funds; life insurance, private placement variable deferred annuity (PPVA); IRC Section 7702; IRC Section 817(h)
Affiliations:
1: Long Gray Line Consulting.