Gimme (tax) shelter: The unlimited annuity shielding ultrawealthy clients

May 21, 2024 by Tobias Salinger

The tax benefits of private placement variable annuities for wealthy clients are drawing scrutiny and calls for a federal crackdown — but they’re not going away anytime soon.

Deferral or the outright avoidance of taxes on income, capital gains and estates has drawn billions of dollars to private placement life insurance and annuities. The growth of the life insurance product — a similar but more complicated strategy with higher potential savings for clients — amounts to contracts totaling nearly $40 billion in policy value, according to an investigation earlier this year by Democrats on the Senate Finance Committee. 

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Originally Posted at Financial Planning on May 16, 2024 by Tobias Salinger.