With the changes of on taxation of Life Settlement Investments, will Life Settlement become securities?

Although the SEC’s involvement in the life settlement market already comes into play for variable-life-insurance policies as well as the securitization of policies, a letter sent recently by SEC Chairman Mary L. Schapiro to Sen. Herbert Kohl, D-Wis., who is chairman of the Senate Special Committee on Aging, suggested that the commission will also look at the registration of life settlement providers and brokers. The SEC declined to comment further.

The Internal Revenue Service recently published guidance on taxing life settlements — both the lump sum that the seller receives and the income tax that the buyer pays upon receiving the insured’s death benefit. The move signals that the federal government is ready to act.

About new tax guidelines:
IRS Issues Two Groundbreaking Rules on Life Settlements

Read complete article:
Feds want to get their hands on life settlements, observers say