Two pieces of the new tax law, the Tax Cuts and Job Act of 2017 (TCJA), have a significant impact on life settlements: the increased estate tax exemption and the clarification of the income tax treatment for life settlements.
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In May 2009, the IRS issued
Revenue Ruling 2009-13 addressing the
tax implications of a life settlement to the seller of a life insurance policy. H.R. 1262 was recently introduced to remedy the shortcomings of this revenue ruling.
A number of factors have reignited the life settlement market with both consumers and investors showing rising interest.
