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Estate Planning

Split Dollar

Arrangements Entered Into Before Final Regulations

Of the arrangements not subject to the final split-dollar regulations (i.e., those entered into on or before September 17, 2003) the safe harbors of Notice 2002-8 regarding taxation of "equity" are applicable only to arrangements entered into before January 28, 2002. If such a pre-January 28, 2002 arrangement is materially modified (in a manner other than merely exercising a safe harbor):

  • After January 28, 2002, but on or before September 17, 2003, then the availability of safe harbor treatment is uncertain, but the final split-dollar regulations do not govern the arrangement;
  • After September 17, 2003, then safe harbor treatment is unavailable, and the final split-dollar regulations govern the arrangement.
Briefs Rulings/Updates

This publication is not intended as legal or tax advice. This information was compiled by The Northwestern Mutual Life Insurance Company. It is intended solely for the information and education and/or promotional purposes of Northwestern Mutual financial representatives and advisors with whom they work. It must not be used as a basis for legal or tax advice, and is not intended to be used and cannot be used to avoid any penalties that may be imposed on a taxpayer. Financial representatives do not give legal or tax advice. Taxpayers should seek advice based on their particular circumstances from an independent tax advisor. Tax and other planning developments after the original date of publication may affect these discussions.

© 2016 The Northwestern Mutual Life Insurance Company, Milwaukee, WI