IRS Issues Private Letter Rulings On Annuity Advisor Fee Proposals
January 20, 2021 by Contributor
The IRS has issued three private letter rulings that could help life insurers offer registered index-linked annuities through fee-based advisors. IRS official Rebecca Baxter ruled in all three cases, “the Fees are integral to the operation of the Adviser Contract.” She told the insurers that they can pay advisory fees directly to an annuity owner’s investment advisor, from the cash value of all three types of contracts, without the annuity owner having to pay federal income taxes on the cash flowing to the advisor.
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