Section 7702 Life Insurance

Internal revenue service irs tax code defines what the federal government considers to be a legitimate life insurance contract and is used to determine how the proceeds.

Section 7702 life insurance. The number refers to the 7702 section of the u s. 1 life insurance contracts must meet one of two tests prescribed by internal revenue code 7702 in order to qualify for favorable tax treatment in the united states. One is the cash value accumulation test cvat.

7702 a 1 meets the cash value accumulation test of subsection b or. The other is the guideline premium and corridor test gpt. Internal revenue code section 7702 section 7702 is a portion of the internal revenue code that describes certain conditions that life policies should satisfy in order to qualify as life insurance contract that has tax advantages.

Law and analysis section 7702 a provides that for a contract to qualify as a life insurance contract for federal income tax purposes the contract must be a life insurance contract under the applicable law and must either 1 satisfy the cash value accumulation test of 7702 b or 2 both meet the guideline premium requirements of 7702 c and fall within the cash value corridor of 7702 d. Section 7702 of the u s. Under this provision x has an attained age of 60 for the first contractyear 61 for the second contractyear and so on.

Section 7702 is the section of the united states internal revenue code that defines what the federal government considers a life insurance contract and that outlines how life insurance contracts are taxed. Life insurance retirement plan lirp under internal revenue code section 7702. Section 1 7702 2 b 1 i provides that if a contractinsures the life of a single insured individual the attained age may be determined by reference to the individual s actual birthday as of the date of determination.

A plan of insurance on file in 1 or more states before september 28 1983 shall be treated for purposes of section 7702 i 3 of such code as a plan of insurance on file in 1 or more states before september 28 1983 without regard to whether such plan of insurance is modified after september 28 1983 to permit the crediting of excess interest or similar amounts annually and not monthly under contracts issued pursuant to such plan of insurance. 7702 a general rule for purposes of this title the term life insurance contract means any contract which is a life insurance contract under the applicable law but only if such contract i r c. This is where life insurance can help combat the reverse discrimination that hurts successful people.