Rate Tables

For detailed information about the valuation of insurance benefit (formerly known as "Value of Economic Benefit" or "VEB") under split-dollar arrangements, see Notice 2002-8, Notice 2002-59, Revenue Ruling 2003-105, and Treas. Reg. §1.61-22(d)(5). For arrangements involving Northwestern Mutual life insurance policies, the guidance provided by these pronouncements is summarized below:

Plans started after January 28, 2002	Table 2001 (government-provided table), or Northwestern Mutual’s rate table, which varies depending upon the applicable date for measuring the value of insurance benefit: From January 2016 and beyond, use the 2016 Low Table For previous years, see rate tables below
Plans started on or before January 28, 2002	Table 2001 (government-provided table), or Northwestern Mutual’s 2000 Low Table

When To Measure the Value of Insurance Benefit:

• The annual value of insurance benefit is measured at the end of the non-owner’s (e.g., the employee/endorsee’s) taxable year (usually December 31), unless the parties have agreed to use the policy anniversary date.
• In the year the arrangement is terminated, however, the value of insurance benefit valuation date is the day the arrangement ends. See Treas. Reg. §1.61-22(d)(5).
• Reporting the Value of Insurance Benefit for Split Dollar and Qualified Plans: New 2016 Term Rates (01/16)
  
  

Example: Employer owns Northwestern Mutual permanent life insurance policy on key employee’s life with death benefit of $1,000,000. An endorsement split dollar agreement allows employee to name a beneficiary for $400,000 of death benefit. Assuming the employee is a 45 year-old female, the Value of Insurance Benefit is calculated as follows using both the IRS and Northwestern Mutual 2016 low table:

• The value of insurance benefit is $612 using IRS Table 2001 ($400,000 X $1.53 / 1,000).
• The value of insurance benefit is $274 using Northwestern Mutual’s 2016 Low Table (100,000 X $1.09 / 1,000 + $300,000 X $0.55 / $1,000).

Links to Rate Tables:

• Government-provided rate tables:
  • Table 2001 (single life)
  • Joint Table 2001 (based on Table 2001, but not formally approved by the I.R.S.)
  • P.S. 58 Table (single life - largely replaced by Table 2001)
  • Joint Life Table (Table 38 Rates)
• Northwestern Mutual's lower rate tables (single life tables only)
  • 2016 Low Table
  • 2010 Low Table
  • 2005 Low Table
  • 2004 Low Table
  • 2000 Low Table