Important Considerations
Understanding the Product
- The Stewardship Life Income is a unique, new
product. It is important that every applicant
insured and every applicant beneficiary have a complete
understanding of all the provisions of the product.
Please read our information thoroughly before making a
decision to purchase or not to purchase a stewardship Life
Income.
Application & Policy Ownership Considerations
- An application for the Stewardship life Income must be
completed containing the required underwriting information
for both the insured and the beneficiary. Special
attention should be given to the selection of the policy
owner. It is imperative that all applicants (both
the insured and the beneficiary) understand the potential
income and estate tax implications of policy
ownership.
Income Tax
- Private Letter #9717033 dated April 30, 1997 indicates
that the monthly benefit proceeds from a reversionary
annuity contract will be treated, for income tax purposes,
similarly to the proceeds of a lump sum life insurance
benefit converted to a monthly settlement option. A
private letter ruling is not a binding precedent.
However, we anticipate that the IRS will continue to act consistently
with the principles laid out in PLR #9717033. After the
guaranteed monthly income payments begin, Baltimore Life
will annually provide each beneficiary with a Form 1099
indicating the amount of taxable income for the
previous year.
Federal Estate Tax
- The Stewardship Life Income provides value only to the beneficiary
designated on the policy data page. There is no
taxable value to the insured's estate, unless the insured
is also the owner of the policy. for this reason, the
beneficiary is usually designated as owner of the policy.
The policy provides no value which will pass upon the beneficiary's
death. Therefore no estate tax liability is incurred
at that time.
Note: All applicants, insureds, beneficiaries
and policy owners are advised to consult a tax advisor for
information regarding his or her specific situation.
Source: The Baltimore Life Companies sales materials provided for use by
Independent Insurance Sales & Brokerage, Inc.
Your Survivor's Future
A Quick Look
Pay Less for Life Insurance?
Prospecting Letter
Proposal Form
Unique Life Insurance
Stewardship Life Income
How it Works
Personal Uses
Business & Estate Planning
Important Considerations
FAQ
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