The MEC’s last stand
May 5, 2014 by ROBERT BLOINK, WILLIAM H. BYRNES
Many financial producers now consider modified endowment contracts (MECs) a tool of the past in structuring clients’ product portfolios — but in many cases, dismissing the MEC too quickly can cause your clients to miss out on a valuable product. While it’s important that your clients understand the potentially adverse tax consequences of MEC classification, they should also understand the key role that MECs can play both in estate and post retirement healthcare planning. For clients with sufficient means, the opportunity to rapidly fund a life insurance contract so as to become subject to the rules governing MECs may actually provide a powerful strategy in the well-rounded planner’s arsenal. Click here to read...