Issue: Under federal law, if an employer amends an employee life insurance benefit program and no longer requires employees to contribute to the premiums and offers a lump-sum payment as reimbursement for previous premiums paid, is there an argument that the lump sum payment is a form of deferred compensation?
|Area of Law:||Insurance Law, Tax Law|
|Keywords:||Lump-sum payment; Deferred compensation; Reimbursement for previous premiums paid|
|Cited Statutes:||I.R.C. §§ 3121(v), 3306(r)|
The IRS may construe the lump-sum payment as payment of deferred compensation under I.R.C. §§ 3121(v) and 3306(r).