Sec. 3513. Tax reporting for life settlement transactions
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Subpart B of part III of subchapter A of chapter 61 is amended by adding at the end the following new section: Every person who acquires a life insurance contract or any interest in a life insurance contract in a reportable policy sale during any taxable year shall make a return for such taxable year (at such time and in such manner as the Secretary shall prescribe) setting forth— the name, address, and TIN of such person, the name, address, and TIN of each recipient of payment in the reportable policy sale, the date of such sale, the name of the issuer of the life insurance contract sold and the policy number of such contract, and the amount of each payment.
Every person required to make a return under this subsection shall furnish to each person whose name is required to be set forth in such return a written statement showing— the name, address, and phone number of the information contact of the person required to make such return, and the information required to be shown on such return with respect to such person, except that in the case of an issuer of a life insurance contract, such statement is not required to include the information specified in paragraph (1)(E).
Upon receipt of the statement required under subsection (a)(2) or upon notice of a transfer of a life insurance contract to a foreign person, each issuer of a life insurance contract shall make a return (at such time and in such manner as the Secretary shall prescribe) setting forth— the name, address, and TIN of the seller who transfers any interest in such contract in such sale, the investment in the contract (as defined in section 72(e)(6)) with respect to such seller, and the policy number of such contract.
Every person required to make a return under this subsection shall furnish to each person whose name is required to be set forth in such return a written statement showing— the name, address, and phone number of the information contact of the person required to make such return, and the information required to be shown on such return with respect to each seller whose name is required to be set forth in such return. Every person who makes a payment of reportable death benefits during any taxable year shall make a return for such taxable year (at such time and in such manner as the Secretary shall prescribe) setting forth— the name, address, and TIN of the person making such payment, the name, address, and TIN of each recipient of such payment, the date of each such payment, and the amount of each such payment.
Every person required to make a return under this subsection shall furnish to each person whose name is required to be set forth in such return a written statement showing— the name, address, and phone number of the information contact of the person required to make such return, and the information required to be shown on such return with respect to each recipient of payment whose name is required to be set forth in such return. For purposes of this section: The term payment means the amount of cash and the fair market value of any consideration transferred in a reportable policy sale.
The term reportable policy sale has the meaning given such term in section 101(a)(3)(B). The term issuer means any life insurance company that bears the risk with respect to a life insurance contract on the date any return or statement is required to be made under this section. The term reportable death benefits means amounts paid by reason of the death of the insured under a life insurance contract that has been transferred in a reportable policy sale. . The table of sections for subpart B of part III of subchapter A of chapter 61 is amended by inserting after the item relating to section 6050W the following new item:
Sec. 6050X. Returns relating to certain life insurance contract transactions. . Subsection
(d)of section 6724 is amended— by striking or at the end of clause
(xxiv)of paragraph (1)(B), by striking and at the end of clause
(xxv)of such paragraph and inserting or , and by inserting after such clause
(xxv)the following new clause: section 6050X (relating to returns relating to certain life insurance contract transactions), and , and by striking or at the end of subparagraph
(GG)of paragraph (2), by striking the period at the end of subparagraph
(HH)of such paragraph and inserting , or , and by inserting after such subparagraph
(HH)the following new subparagraph: subsection (a)(2), (b)(2), or (c)(2) of section 6050X (relating to returns relating to certain life insurance contract transactions). . Section 6047 is amended— by redesignating subsection
(g)as subsection (h), by inserting after subsection
(f)the following new subsection: This section shall not apply to any information which is required to be reported under section 6050X. , and by adding at the end of subsection (h), as so redesignated, the following new paragraph: For provisions requiring reporting of information relating to certain life insurance contract transactions, see section 6050X. . The amendments made by this section shall apply to— reportable policy sales (as defined in section 6050X(d)(2) of the Internal Revenue Code of 1986 (as added by subsection (a)) after December 31, 2014, and reportable death benefits (as defined in section 6050X(d)(4) of such Code (as added by subsection (a)) paid after December 31, 2014.