Common use of Requirements to File Returns Clause in Contracts

Requirements to File Returns. The IRS recently issued final regulations under Code Section 6039I relating to the exceptions to Code Section 101(j)(1), providing that certain reporting and recordkeeping requirements must be maintained by the applicable policyholders. Every applicable policyholder who owns one or more EOLI contract issued after August 17, 2006, must file Form 8925, " Report of Employer-Owned Life Insurance Contracts" with the Internal Revenue Service for each year the contracts are owned. The filing must include the applicable policyholder's name, taxpayer identification number and the type of business the policyholder conducts. The return also requires a disclosure of the number of employees of the applicable policyholder at the end of the year and how many are insured under such contracts. Finally, the applicable policyholder must report the total amount of insurance contracts in force and confirm whether or not it has a valid consent for each insured employee.