Comments Concerning IRS Notice 2001–10
Comments on Notice 2001–10
The purpose of this letter is to respond to the request for comments set forth in the Notice. The Notice provides Interim Guidance that changes longstanding rules governing SDAs. Additional guidance is needed before taxpayers and their advisors can properly evaluate how to characterize Equity SDAs. Taxpayers with Equity SDAs established before the Notice's publication date who have relied on reasonable interpretations of Revenue Ruling 64-328 should be entitled to grandfather protection consistent with the terms of their written arrangements. Rules for measuring the value of death benefit coverage values under SDAs should reflect actual policy costs consistent with the important goals of promoting clear, objective and uniform standards for measuring and reporting income.