Technical And Miscellaneous Revenue Act Of 1988 (TAMRA): Income Taxation Of Cash Value Life Insurance
Definition of "Technical and miscellaneous revenue act of 1988 (TAMRA): income taxation of cash value life insurance"
Determination that policies entered into on or after June 21,1988, that fail the 7-pay test (aggregate premiums paid at any time during the first 7 years of the contract exceed the annual net level premium of a 7-pay policy multiplied by the number of years the policy has been in force) are considered by the Internal Revenue Service (IRS) to be modified endowment contracts (MECs). If the policy is determined to be a MEC, it may be subject to income taxes as well as penalty taxes. Any policy loans, dividends, or partial withdrawals of funds are treated by the IRS for income tax purposes on a last-in, first-out basis.
Popular Insurance Terms
Company owned by its policy owners; no stock is available for purchase on the stock exchanges. ...
Local life insurance office that sells and services ordinary life insurance as well as other forms of life insurance except debt insurance. ...
Term used in the reinsuring of disability income insurance policies in that, after an extended period of time expires (in addition to the elimination period found in the disability income ...
Something that cannot be changed. In life insurance, a beneficiary who has been named as irrevocable cannot be changed without his or her formal (written) permission. ...
Same as term Fixed Dollar Annuity: annuity that guarantees that a specific sum of money will be paid in the future, usually as monthly income, to an annuitant. For example, a $1000-a-month ...
Basis for calculating life insurance premiums and benefits using current interest and mortality rates, rather than historic rates. Current assumptions are critical to interest-sensitive ...
Payment to a broker, master general agent, general agent, or agent on any particular line of insurance written by other agents within a particular geographical area. ...
Actuarial method of calculating benefits and their costs for all the employees as a group rather than for each individual employee. The costs of the benefits are measured in the form of a ...
Policy similar to that of an individual universal life insurance policy except that the coverage is provided (up to a limit) without the requirement of the submission of evidence of ...
Have a question or comment?
We're here to help.