Jump to content

calculating PS-58 cost?


Guest pjg

Recommended Posts

We are being told by several different Ins Cos that they no longer providE the PS-58 costs for the 1099-R reporting. There was a new table issued for this purpose in Notice 2002-8. Which types of ins policies should ps-58 costs be calcualted for????? We are getting conflicting info. Does anyone out there know for sure???? Thanks!!!

Link to comment
Share on other sites

check Code Sec. 72(m)(3)(B)

I think it says any policy with a death benefit in excess of the cash value (which includes term).

My understanding of their not providing the cost is that they can't handle doing the math [(death benefit - cash value) x cost/thousand], so they push it off on the TPA/CPA or whoever will stand up and do it.

CBW

Link to comment
Share on other sites

We have also run into insurance companies refusing to provide this information (although they did in the past).

I don't understand this. The calculation of the cost makes a comparison of the insurance company rates and the table from PS 58. If they don't provide their rates, how do you know if you are calculating the correct amount?

Link to comment
Share on other sites

The revision of the PS 58 tables by the IRS was intended to prevent Ins co from making up special rates for LI policies to circumvent the PS 58 rates. The IRS position is that the new ps 58 rates are a reasonable charges for LI coverage and that an Ins co that uses lower published rates must demonstrate that such rates are available to all standard risks for individual initial issue 1 year term policies, not just owners of employer based polices. See Notice 2002-08 , III 3. As a result many ins co are refusing to publish their rates.

mjb

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...