Printer Friendly

Health insurance.

646. Is an accidental death benefit payable under a health insurance policy includable in the insured's gross estate?

Such benefits are "life insurance" proceeds, and are subject to the same rules as proceeds under regular life insurance policies (see Q 626). (1) When insured purchased a one year accidental death policy and arranged for the policy to be owned by his children from the beginning, the proceeds were includable in his estate as a transfer in contemplation of death when he died within the policy term. (2)

647. Are medical expense reimbursement insurance proceeds received by the insured decedent's estate includable in the gross estate?

IRS has ruled that such payments are includable under IRC Section 2033 (see Q 852(1)) if the insured had an enforceable right to the proceeds at his death. (3)

(1.) Comm. v. Est. of Noel, 380 U.S. 678 (1965); Est. of Ackerman v. Comm., 15 BTA 635 (1929); see Rev. Rul. 66-262, 1966-2 CB 105.

(2.) Rev. Rul. 71-497, 1971-2 CB 329; Bel v. U.S., 452 F.2d 683 (5th Cir. 1971), cert. den. 406 U.S. 919.

(3.) Rev. Rul. 78-292, 1978-2 CB 233.

COPYRIGHT 2010 ALM Media, LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2010 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:PART II: FEDERAL ESTATE TAX ON INSURANCE AND EMPLOYEE BENEFITS
Publication:Tax Facts on Insurance and Employee Benefits
Date:Jan 1, 2010
Words:193
Previous Article:Group life insurance.
Next Article:Individual retirement plans.
Topics:

Terms of use | Privacy policy | Copyright © 2021 Farlex, Inc. | Feedback | For webmasters |