Life Insurance Policies for the Rich Targeted in Wyden Tax Bill

December 26, 2024 by Zach C. Cohen and Chris Cioffi

Ultra-wealthy investors’ life insurance policies face new taxes under draft legislation unveiled Monday by Senate Finance Committee Chair Ron Wyden, the Oregon Democrat’s latest effort to expose the decades-old inheritance strategy to IRS oversight.

Wyden’s proposed legislative text would reclassify so-called private placement life insurance polices and similar annuities as “private placement contracts” if they meet certain criteria. The change would impact a sliver of outstanding life insurance policies, and raise taxes on earnings and losses and when the policies are paid out, according to summaries provided by Wyden’s office.

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Originally Posted at Bloomberg Law on December 15, 2024 by Zach C. Cohen and Chris Cioffi.