The Perfect Storm

December 29, 2008

In the prior article describing the "perfect storm" that is swamping compensatory split dollar arrangements, we reviewed the changes to the law applicable to all split dollar plans that had intersected to apply to all compensatory split dollar arrangements. Those changes included the issuance of IRS Notices 2002-8 and 2007-43, and the adoption of the Final Split Dollar Regulations, and the adoption of Section 409A by Congress. That article defined compensatory split dollar arrangements, reviewed the income tax rules applicable to both pre-final regulation split dollar arrangements and those entered into after the effective date of the final regulations (or modified thereafter), and distinguished between the income tax treatment of post-final regulation split dollar arrangements taxed under the economic benefit regime and those taxed under the loan regime. That article concluded by providing that a follow-up article reviewing the extra layer of complexity compensatory split dollar arrangements entered into between tax-exempt employers and their executives added to the mix. This is that article.

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BOLI in the News

May 29, 2008

In recent weeks much has been written about the sizable losses that were taken by a few large banks due to write downs of their Bank Owned Life Insurance portfolios. Bank Owned Life Insurance (BOLI) is also known as wholesale or institutional insurance, because no loads or expenses are passed to the policy owner except the mortality charge. BOLI has been purchased by financial institutions for over 25 years as an attractive investment used to offset the costs of providing employee benefits. BOLI has traditionally been thought of as an extremely conservative and stable asset, so what led to the sizeable write downs at Fifth Third Bank and Wachovia and should you be worried about your BOLI holdings?

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Strategies in Executive Compensation By Christine Burns-Fazzi

May 23, 2008

High performing people drive the nation’s federal credit unions. Despite major differences in asset size, employment size, split of responsibilities and membership criteria, people in the executive offices are making the decisions that propel the nation’s credit union business forward.

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Frequently Asked Questions - Post Reitrement Medical Plans

January 1, 2007

With the cost of health care increasing by double digits each year, post- retirement health care plans are becoming a hot button in the area of employee benefits. Credit unions seeking to retain and reward their top-notch talent need to learn more about these plans and consider including them as part of their executive compensation package.

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Roles and Responsibilities of a Fiduciary

March 1, 2006

The last several years have seen issues surrounding employer sponsored retirement plans make headlines. The company stock scandals connected with the Enron collapse, the recently predicted death of traditional pension plans and the pending pension legislative reform currently being considered in joint committee to reconcile the US Senate and House pension bills are a few. The laws that govern retirement plans are complex and often little understood by those who are required to adhere to them.

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