Private Placement Life Insurance and the Tax Code

 Webber Revealed: The Real Opinion

What is commonly considered an aggressive tax strategy is when you take a section of the tax code and bend it in favor of a tax benefit. Our approach with Private Placement Life Insurance (PPLI) is to use the tax code sections that are pertinent to our structure as a guide to make the asset structure fully compliant with the code. No element of the tax code is bent or stretched to obtain a favorable result.

We use the tax code as a road map to be followed, and not something to be diverted or obfuscated in any way. Is it not preferable to rely on the tax code rather than an opinion letter from a law firm? This opinion letter is just their interpretation of the tax code. Why rely on opinion when you can base your asset structure on the language of the tax code itself?

Those who call our firm’s PPLI structures aggressive do not fully understand the tax code, although they present themselves as experts who do. What you find in their articles is the same misunderstandings regurgitated time and time again, until, in the end, they are believed to be truths.

These misunderstandings are also repeated time and time again at the usual PPLI conferences that are held throughout each year, which entrenches these misconceptions and half truths about the true nature of the tax advantages of PPLI. In our next few articles, we will discuss the topic in detail, and give you the tax code sections, so you can prove our points for yourself.

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by Michael Malloy, CLU TEP RFC.

CEO, Founder @EWP Financial

Michael Malloy-CLU-TEP