Plan Sponsor is Ins. Co. making commisisons on investments in the plan

[jkharvey]

I haven't been able to research the specifics on this yet, but off the top of your head does anyone know if there is a PT exemption for this?

The sponsor is an insurance company. The plan is invested in funds of the insurance company and the sponsor receives commissions based on those investments. It just seems "wrong".

[Belgarath]

Perhaps IRC 4975(d)(5)? I must say I don't quite understand how an insurance company would receive commissions for policies in its own plan. So you are saying, for example, that Prudential sponsors a plan, and as one of the investments in that plan, there are life insurance policies on the individual participants? And that commissions are paid on the "sales" of these policies? To whom are they paid? Does sound pretty weird if that's what is happening...

[Ron Snyder]

I believe that this PT Exemption was granted many years ago at the request of the American Council of Life Insurance. However, it would be very easy to get around in any event. Simply retain and refuse to pay commissions rather than paying them to themselves. What difference would it make? And why do you seem incensed at the prospect?