Sentences with phrase «buyer in a life settlement»

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In the book, Gardner outlines exactly what Life Settlements are, how they are purchased, the benefit to both the buyer and seller, and the overall tax consequences of investing in thesIn the book, Gardner outlines exactly what Life Settlements are, how they are purchased, the benefit to both the buyer and seller, and the overall tax consequences of investing in thesin these.

Policyholders face a similar problem when they are deciding whether to keep or drop a policy, and it can lead them to view a life settlement as their most attractive option, even in a buyer's market.

In a life settlement transaction, the policy's owner transfers ownership of the policy to the buyer in exchange for an immediate cash payment and, in some instances, a reduced interest in the death benefit for the policy's beneficiarieIn a life settlement transaction, the policy's owner transfers ownership of the policy to the buyer in exchange for an immediate cash payment and, in some instances, a reduced interest in the death benefit for the policy's beneficiariein exchange for an immediate cash payment and, in some instances, a reduced interest in the death benefit for the policy's beneficiariein some instances, a reduced interest in the death benefit for the policy's beneficiariein the death benefit for the policy's beneficiaries.

The virtue of engaging in a life settlement is that in some cases, the buyer will pay more than «just» the remaining net cash value surrender after repaying the loan, which means the person who was going to let the policy go anyway simply gets more cash in his / her pocket.

A life settlement transaction will be most favorable for an insured who has had a significant adverse change in health, such that the policy is likely to pay out as a death benefit sooner rather than later (and thus why the buyer will pay more); the caveat, however, is that in such situations, it's especially appealing to keep the policy for that very reason (as if it's good for the investor, it's good for the original policyowner, too!).

However, because a life settlements transaction itself — the purchase and change in ownership — are not themselves reportable events, the IRS has struggled to track whether buyers of life settlements transactions are properly reporting their taxable death benefits (or not).