Life Insurance in Advanced Estate Planning

Date: Tuesday, October 25, 2022
Time: 4:30pm - 7:30pm
Location: Santa Barbara Club, 1105 Chapala
Speaker: Clint Hodges, Private Wealth Advisor with U.S. Bank & Lindsay Cigler, JD Consultant, Advanced Designs Unit, Pacific Life Insurance Company

Clint Hodges is a Private Wealth Advisor with U.S. Bank.  Clint is also a currently licensed California attorney and former IRS attorney (Estate & Gift Tax Division). Lindsay Cigler, JD is a Consultant with the Advanced Designs Unit of  Pacific Life Insurance Company.  Lindsay and Clint will discuss recent developments in generational split-dollar estate planning in light of the recent Estate of Levine v. Commissioner case which was decided in February of this year.  The discussion would include conclusions of the Tax Court:

1.            Treasury Regulation § 1.61-22 governs only the gift-tax consequences of this transaction.

2.            How a receivable created by the estate plan resulted in only the right to receive the greater of premiums paid or the cash surrender values of the policies when they are terminated.

3.            I.R.C. §§ 2036(a)(2) and 2038 do not require inclusion of the policies’ cash-surrender values because D did not have any right, whether by herself or in conjunction with anyone else, to terminate the policies because only the irrevocable trust had that right.

4.            I.R.C. § 2703 applies only to property interests that D held at the time of her death. There were no restrictions on the split-dollar receivable, so I.R.C. § 2703 is inapplicable.

Finally, they will conclude by generally discussing insurance premium financing and the best practices associated with this whether related to a generational split-dollar transactions or not.

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