Applicable Insurance Contracts Information Return

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Instructions for Form 8921

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Instructions for Form 8921

Department of the Treasury
Internal Revenue Service

(August 2007)
Applicable Insurance Contracts Information Return
Section references are to the Internal Revenue Code unless
otherwise noted.

If filing using a private delivery service, the private delivery
service can tell you how to get written proof of the mailing date.

General Instructions

Penalty

Purpose of Form
Generally, an applicable exempt organization must file a Form
8921 for each structured transaction under which it makes
reportable acquisitions of applicable insurance contracts. See
Definitions below for terms used in these instructions and Form
8921. For more information on the reporting requirements, see
section 6050V. See When and Where to File below regarding
filing deadlines.

Who Must File
Applicable exempt organizations must file Form 8921 if they
acquire a direct or indirect interest in an applicable insurance
contract after August 17, 2006, and on or before August 17,
2008, regardless of the date of the structured transaction itself.
A separate Form 8921 must be filed with respect to each
separate structured transaction to which the organization is a
party. See Definitions below.

How to Complete Form
In order to be considered complete, Form 8921 must be
completed in its entirety with all required attachments. If the
information required exceeds the space provided, attach
additional sheets. The additional sheets must be in the same
order as the lines to which they correspond. Include your
organization’s name, employer identification number (EIN), and
the structured transaction identifier (STI) at the top of each
additional sheet.
Round off cents to whole dollars. To round, drop amounts
under 50 cents and increase amounts from 50 to 99 cents to
the next dollar. For example, $1.39 becomes $1 and $2.50
becomes $3. If two or more amounts must be added to figure
the amount to enter on a line, include cents when adding the
amounts and round off only the total.

There is a penalty under section 6721 for the failure to file a
required Form 8921 by the required filing date. See When and
Where to File earlier. Other penalties are imposed for failure to
include all information and required attachments, or for
inclusion of incorrect information. See sections 6721 and
6724(d)(1)(B)(xiv).
If one or more failures are due to intentional disregard of the
filing requirement (or the correct information reporting
requirement), then the penalty per failure is the greater of (a)
$100 or (b) 10% of the value of the benefit of any applicable
insurance contract for which information is required to be
included on the return. In this case, the penalty imposed for
such intentional disregard is not taken into account in applying
any calendar year limitation. See section 6721(e).
No penalty shall be imposed for any failure if it is shown that
such failure is due to reasonable cause and not to willful
neglect. See section 6724(a).

Definitions
Applicable Exempt Organization
An applicable exempt organization is generally a religious,
charitable, scientific, literary, educational, amateur sports or
similar organization, a governmental organization, a fraternal
society operating on a lodge system, a veterans’ organization,
an Indian tribal government, a cemetery company, or an
employee stock ownership plan. See section 6050V(d)(3) for
more details. The term “organization,” when used in these
instructions, refers to an applicable exempt organization.

Applicable Insurance Contract

IF reportable
AND on or before...
acquisitions were
made, or new or
corrected information
was obtained, after...

THEN file an initial or
subsequent Form
8921 by...

August 17, 2006,

August 17, 2007,

November 1, 2007

An applicable insurance contract is any life insurance, annuity,
or endowment contract in which both an applicable exempt
organization and a person other than an applicable exempt
organization have directly or indirectly held an interest (whether
or not at the same time). However, a contract is not an
applicable insurance contract if:
• Each person directly or indirectly holding an interest in the
contract (other than an applicable exempt organization) has an
insurable interest in the insured under the contract that is
independent of the applicable exempt organization’s interest in
the contract,
• The sole interest in the contract of each involved person is as
a named beneficiary, or
• Under certain circumstances, the sole interest in the contract
of each person other than an applicable exempt organization is
as a beneficiary of one or more trusts holding an interest in the
contract, or as a trustee who holds an interest in the contract
solely in a fiduciary capacity. See section 6050V(d)(2).

August 17, 2007,

August 17, 2008,

October 31, 2008

Broker/Advisor

When and Where to File
If an applicable exempt organization makes a reportable
acquisition after August 17, 2006, and on or before August 17,
2008, it must file a Form 8921 according to the following
schedule.

If any information required by Form 8921 is unavailable at the
time of filing, or if any information already provided changes or
is found to be in error, then an updated or corrected Form 8921
must be filed according to the above schedule.
Where to send. Send Form 8921 to the following address.
Department of the Treasury
Internal Revenue Service
Ogden, UT 84201-0027

A broker/advisor is any person that, for compensation, supplies
professional services to the other parties to the structured
transaction. This transaction role includes persons providing
legal, financial, accounting, or other advice, as well as persons
providing brokerage or investment banking services.

Contract Beneficiary
A contract beneficiary is any person eligible to receive death or
endowment benefits, in the case of life or endowment
insurance, or annuity payments in the case of annuities. There

Cat. No. 49348T

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Instructions for Form 8921

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may be more than one contract beneficiary with respect to a
single contract.

Specific Instructions

Contract Form

Part I. Identifying Information

Each contract form must be identified by each contract type
(such as a life insurance policy, endowment policy, or annuity
contract). Each contract form must also be separately identified
if the contract forms are issued by different insurers or if they
have differing terms (such as different premium structures,
investment options, or withdrawal options) from other contracts
of the same type. For example, if the answers with respect to
any two contracts differ for line 10a, 10b, 10c, 11, 12d, 13a,
15a, or 17 of Form 8921, then the two contracts constitute
separate contract forms, and each contract form must be
identified and reported in a separate column for purposes of
answering questions under Part III of Form 8921.

Line 1
Enter the date (MM/DD/YYYY) that your organization entered
into the structured transaction. This is the earliest date on which
your organization agreed to terms with any other party to the
structured transaction or on which your organization supplied
relevant information on potential insureds.

Line 2
Enter a structured transaction identifier (STI). The STI is to be
used to identify the section 6050V structured transaction for
which this Form 8921 is being filed. It should be entered on all
additional sheets attached to Form 8921, and on all other
required attachments to Form 8921.
The STI consists of the letters “STI” followed by a four-digit
number that is unique for each structured transaction to which
your organization is a party. For example, if this is the sole
structured transaction entered into by your organization, enter
0001 after STI on line 2. The “STI0001” would be entered on all
additional sheets and on all other required attachments to Form
8921. If your organization is a party to a second structured
transaction, the STI would read “STI0002” for that transaction.

Contract Owner
A contract owner is any person possessing any benefits and
burdens of ownership as they relate to applicable insurance
contracts. Generally, this is any person with the power to
change a beneficiary designation, to borrow a part (or all) of a
policy’s cash value, or to otherwise withdraw funds. There may
be more than one contract owner with respect to a single
contract.

Creditor

Line 3

A creditor is a person that supplies funds in return for a fixed
return or a variable rate of return that is determined by an
interest rate index and a spread.

Check the appropriate box. A corrected return must be filed to
correct any errors on any previously filed Form 8921 or to add
appropriate information on an incomplete Form 8921. An
updated form must be filed if any additional applicable
insurance contracts have been acquired, or if there is any
material change in the terms or relationship in a structured
transaction. For any subsequently filed Form 8921, complete
Part I fully, but complete other lines only if they are being
corrected or updated. Enter the correct information for each
changed line, not the difference in amount from the previous
form.

Insurable Interest
Insurable interest is a state law concept which requires that a
life insurance policyholder have a direct interest in the
continuance of the life of the insured. For example, a
tax-exempt organization may have an insurable interest in the
lives of its donors. An organization’s role in a structured
transaction is to provide an insurable interest if one or more
applicable insurance contracts are purchased based on the
organization’s relationship to the insured individual.

Lines 4a through 4f

Investor

Enter the name, employer identification number (EIN), mailing
address, website address, and the state (or, if a foreign entity,
the country) in which your organization is organized. The EIN
(along with the STI) must be entered also on all additional
sheets attached to Form 8921, and on all other required
attachments to Form 8921.

An investor is a person, other than a creditor, that supplies
funds in return for an equity interest. An equity interest exists
wherever compensation is variable and uncertain in amount,
timing, or both (other than with respect to a variable interest
contract) at the time the outlay of funds is made.

Line 5

Party to the Structured Transaction

Check all boxes that describe your organization’s role in the
structured transaction. See Definitions above.

A party to the structured transaction is any person (other than
the applicable exempt organization filing the Form 8921) that is
known to hold (directly or indirectly) an interest in one or more
applicable insurance contracts, or who otherwise receives (or
will receive) amounts from the structured transaction. An
insured is not a party to the transaction, unless that person has
an interest in the applicable insurance contract or the structured
transaction other than as an insured.

Lines 7a and 7b
Enter on line 7a the amounts received by your organization
under the structured transaction at the time of the filing of this
Form 8921.
Enter on line 7b the amounts expected to be received by
your organization under the structured transaction in the future.
Amounts should be expected values, based on contract terms
and/or amounts shown in promotional or other materials.

Reportable Acquisition
A reportable acquisition is one in which an acquisition is made
of a direct or indirect interest in an applicable insurance contract
when the acquisition is a part of a structured transaction
involving a pool of such contracts.

Part II. Parties to the Structured
Transaction

Structured Transaction

Lines 8a through 8l

A structured transaction is any transaction in which an
applicable exempt organization acquires a direct or indirect
interest in a pool of applicable insurance contracts.

Enter the requested information for each party to the structured
transaction. See Definitions earlier for the definition of a party to
the structured transaction and for definitions of the party’s role
in the structured transaction. Use a separate column for each
party. Attach additional sheets as necessary.
Lines 8a through 8c. Enter the name, social security or
employer identification number, and mailing address of each
party to the structured transaction.

Structured Transaction Identifier (STI)
A structured transaction identifier (STI) is a 4-digit number used
to identify the structured transaction for which a Form 8921 is
being filed. See instructions for line 2, below.

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Line 8d. Check all boxes that describe the party’s role or roles
in the structured transaction. If “Other” is checked, provide a
description in the space provided. See Definitions earlier for
definitions of roles.
Line 8e. Check the appropriate box that describes the party’s
legal form. If “Other” is checked, provide a description in the
space provided.
Line 8f. Check the box if the party to the structured transaction
is a foreign entity not subject to U.S. federal income tax.
Line 8g. Check the box if the party to the structured
transaction is an applicable exempt organization.
Line 8h. If the party to the structured transaction is a trust,
partnership, association, or corporation, enter the number of
trust beneficiaries, partners or association members, or
corporate stockholders as of the filing date.
Line 8i. Report amounts paid or expected to be paid by the
party under the structured transaction. Amounts to be paid in
the future are expected values based on contract terms and/or
amounts shown in promotional or other materials.
Line 8j. Report amounts received by the party to the
structured transaction as of the filing date of this Form 8921.
Line 8k. Report amounts to be received by the party to the
structured transaction in the future. Future amounts are
expected values, based on contract terms and/or amounts
shown in promotional or other materials.
Line 8l. Check the appropriate box for each reportable person
for whom the amounts reported on line 8j or line 8k and/or their
timing depend on the payment of death or endowment benefits,
or annuity benefits.

Enter on line 13b and 13c the aggregate premiums paid or to
be paid for contracts issued under each separate contract form.
Allocate premiums according to whether they have been or will
be paid in the first policy year or later. Future premiums are to
be included on line 13c, and should be expected values based
on contract terms and/or amounts shown in promotional or
other materials.
Lines 14a and 14b. Enter on line 14a the aggregate value of
death or endowment benefits associated with all contracts
issued under each separate contract form as of the dates the
contracts were issued.
Enter on line 14b, for each contract form, the smallest and
the largest contract death or endowment benefit as specified on
the date each contract was issued.
Lines 15a through 15c. Complete lines 15a through 15c if the
contract type is an immediate annuity. Otherwise, go to line
16a.
On line 15a, check the “Fixed” box if annuity payments are
fixed in amount or are indexed only to a consumer price index.
Check the “Variable” box if they are dependent upon a fund
value or other index (other than a consumer price index).
Whether fixed or variable, check the “Inflation-indexed” box if
the annuity is indexed to a consumer or similar price index.
Enter on line 15b the aggregate value of monthly annuity
payments (or monthly equivalent payments, if payments are not
made on a monthly basis) for all contracts issued under each
immediate annuity contract form. This value should reflect
annuity payments when the contracts were first issued.
Enter on line 15c the values of the smallest and largest
monthly annuity payments (or monthly equivalent payments, if
payments are not made on a monthly basis) for immediate
annuity contracts issued under each immediate contract form.
These values should reflect the annuity payments when a
contract was first issued.
Lines 16a and 16b. Enter on line 16a the aggregate policy
loans made (or expected to be made) under each contract form.
Enter on line 16b the aggregate value of any other amounts
distributed (or expected to be distributed) from each contract
form (other than as death or annuity benefits or as loans). For
example, include any anticipated partial withdrawals of cash
values or any expected amounts to be received upon the future
surrender of the contracts.
Line 17. Identify the available investment options under the
contract. Check all boxes that apply, even if one or more
options are not chosen.

Part III. Applicable Insurance Contract
Forms
Lines 9 through 21
Enter the requested information for each separate contract form
for the structured transaction being reported on this Form 8921.
See Definitions earlier for the definition of a contract form. A
separate column must be used for each contract form. Attach
additional sheets as necessary.
Line 9. Enter a contract form identifier (number or name) that
can be used to identify the contract being reported in each
column. Mark any contract form attachments submitted
according to the line 21 instructions with the appropriate
contract form identifier.
Lines 10a through 10c. Enter the name and employer
identification number of the insurer issuing the contract form,
and specify the state (or, if a foreign entity, the country) in which
the insurer is organized.
Line 11. Check the box that appropriately identifies the type of
applicable insurance contract. An immediate annuity is a
contract under which the first benefit payment is due within one
year from the date of purchase. Under a deferred annuity,
payments begin, if at all, at a later date.
Lines 12a through 12d. On lines 12a and 12b, enter the
earliest and latest dates (MM/DD/YYYY) on which a contract
was issued under each contract form. Enter the total number of
policies issued under each contract form on line 12c. For group
insurance, enter the number of policy certificates issued under
the group contract on line 12c, and check the box under line
12d. The entry on line 12c should be the number of contracts
(or, in the case of a group contract, the number of certificates),
and may not correspond to the number of insureds.
Lines 13a through 13c. On line 13a, check the “Fixed in
contract” box if premium obligations are fixed in amount and
period by the insurance contract. If premiums are to be paid
over the life of the insured(s), check the box “Life of the
insured.” If the premium term is fixed, check the “years” box and
enter the premium term in years. Check the “Discretionary” box
if premium amounts and timing are determined at the discretion
of a contract owner.

IF...

THEN check box
for...

No specified investment option is available (for
example, when only a guaranteed cash value
schedule is specified), regardless of whether or not
policyholder dividends may be paid

No option.

Fixed or variable rates of interest are specified, but
there is no possibility that the market value of the
contract cash value may decline due to changes in
the market pricing of shares

Guaranteed
interest.

Investments in bond, equity, or blended funds are
available, and the cash value of the contract
depends on the market value of the underlying
investments

Bond or equity
funds.

The contract provides other types of investment
Other. Provide a
options, including options that offer additional
description in the
guarantees as to the contract cash value (for
space provided.
example, contracts that guarantee a fixed or variable
floor on cash values in situations where the market
value of the underlying investments declines)

Lines 18a through 18c. Enter the number of insured males
and insured females for each contract form on line 18a. Specify
the average age at issue of all insureds for each contract form

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on line 18b, and specify the youngest and oldest insured for
each contract form on line 18c.
Lines 19a and 19b. Enter on line 19a the number of insureds
that are donors to your organization. On line 19b, enter the
aggregate value of the donations received by your organization
from individuals insured under each contract form. These
values are those applicable to the calendar year most recently
completed prior to the structured transaction date (reported on
line 1).
Line 20. Attach a detailed description of the structured
transaction. Your description must:
• State all material facts that are relevant to understanding the
structure, economic benefits, and tax consequences of the
structured transaction;
• Identify the owners and beneficiaries of the applicable
insurance contracts;
• Describe the nature of the cash flows among parties
described on lines 8a through 8l, and between such parties and
your organization, including the methods used to allocate
earnings and insurance benefits;
• Identify recipients or payers of any residual surplus or deficit
amounts; and
• If interest rates are fixed by contract, provide the specific
rates and terms, and if variable, identify the index(es) and
spread(s).
Line 21. Attach copies of related documents, including
representative copies of applicable insurance contracts issued
as part of the structured transaction for which this Form 8921 is
being filed. Also include any contracts governing the obligations
of persons described on line 8a and any agreements covering
the relationship of your organization to such persons. Include
promotional materials (including financial projections) provided
to your organization, to your donors, or to other persons who
have directly or indirectly held an interest in the applicable
insurance contracts.

Paperwork Reduction Act Notice. You are not required to
provide the information requested on a form that is subject to
the Paperwork Reduction Act unless the form displays a valid
OMB control number. Books or records relating to a form or its
instructions must be retained as long as their contents may
become material in the administration of any Internal Revenue
law. Generally, tax returns and return information are
confidential, as required by section 6103.
The time needed to complete and file these forms will vary
depending on individual circumstances, such as the complexity
of the section 6050V structured transaction and the number of
individuals insured under the applicable insurance contracts.
The estimated burden of applicable exempt organizations filing
these forms is approved under the OMB control number
1545-2083 and is shown below.
Recordkeeping . . . . . . . . . . . . . . . . . . . . . . . . .
Learning about the law or the form . . . . . . . . . . .
Preparing, copying, assembling, and sending the
form to the IRS . . . . . . . . . . . . . . . . . . . . . . . . . .

33 hrs., 43 min.
47 min.
1 hr., 22 min.

If you have comments concerning the accuracy of these time
estimates or suggestions for making this form simpler, we
would be happy to hear from you. You can write to the
Department of the Treasury, Internal Revenue Service, Tax
Products Coordinating Committee, SE:W:CAR:MP:T:T:SP,
1111 Constitution Ave. NW, IR-6526, Washington, DC 20224.
Do not send the form to this address. Instead, see When and
Where to File on page 1.

Part IV. Signature
An authorized individual must sign and date the Form 8921 for
your organization. Enter that individual’s name, title, and
telephone number in the spaces provided.

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