Form 8925 Report of Employer-Owned Life Insurance Contracts

Form

8925

Report of Employer-Owned Life Insurance Contracts

(January 2008)

©

OMB No. 1545-2089

Attach to the policyholder’s tax return—See instructions.

Name(s) shown on return

Attachment
Sequence No.
Identifying number

Name of policyholder, if different from above

Identifying number, if different from above

Department of the Treasury
Internal Revenue Service (99)

160

Type of business

1
2

Enter the number of employees the policyholder had at the end of the tax year
Enter the number of employees included on line 1 who were insured at the end of the tax
year under the policyholder’s employer-owned life insurance contract(s) issued after August
17, 2006. See Section 1035 exchanges below for an exception

3
4a
b

Enter the total amount of employer-owned life insurance in force at the end of the tax year
for employees who were insured under the contract(s) specified on line 2
Does the policyholder have a valid consent (see instructions) for each
employee included on line 2?
Yes
No
If “No,” enter the number of employees included on line 2 for whom the policyholder does
not have a valid consent

General Instructions
Section references are to the Internal
Revenue Code unless otherwise noted.

Purpose of Form
Use Form 8925 to report the number of
employees covered by
employer-owned life insurance
contracts issued after August 17, 2006,
and the total amount of
employer-owned life insurance in force
on those employees at the end of the
tax year. Policyholders must also
indicate whether a valid consent has
been received from each covered
employee, and the number of covered
employees for which a valid consent
has not been received. See section
6039I for more information.

Definitions
Employer-owned life insurance
contract. For purposes of Form 8925,
an insurance contract is an
employer-owned life insurance
contract if it is owned by a policyholder
as defined below, and covers the life of
the policyholder’s employee(s) on the
date the life insurance contract is
issued. If you have master contracts,
see section 101(j)(3) for additional
information.
Policyholder. Generally, a policyholder
is a person who is (a) engaged in a
trade or business that employs the
person insured under the
employer-owned life insurance
contract and (b) the direct or indirect
beneficiary of the employer-owned life
insurance contract.

Related person. A related person is
considered a policyholder if that
person is (a) related to the policyholder
(defined earlier) under sections 267(b)
or 707(b)(1), or (b) engaged in a trade
or business under common control
with the policyholder. See sections
52(a) and (b).
Employee. Employee includes an
officer, director, or highly compensated
employee under section 414(q).
Insured. An individual must be a U.S.
citizen or resident to be considered
insured under an employer-owned life
insurance contract. Both individuals
covered by a contract covering the
joint lives of two individuals are
considered insured.
Notice and consent requirements. To
qualify as an employer-owned life
insurance contract, the policyholder
must meet the notice and consent
requirements listed below before the
issuance of the contract.
1. Provide written notification to the
employee stating the policyholder
intends to insure the employee’s life
and the maximum face amount for
which the employee could be insured
at the time the contract was issued.
2. Provide written notification to the
employee that the policyholder will be
a beneficiary of any proceeds payable
upon the death of the employee.

1

2
3

4b

insurance contracts issued after
August 17, 2006, must file Form 8925
for each tax year the contract(s) is
owned. However, you are not required
to file Form 8925 for any tax year
ending before November 14, 2007.
Section 1035 exchanges.
Policyholders are not required to
complete Form 8925 for a life
insurance contract issued after August
17, 2006, as part of a section 1035
exchange for a contract issued before
August 18, 2006.
However, any material increase in the
death benefit or other material change
to the contract will cause it to be
treated as a new contract and the
policyholder is required to file Form
8925. For master contracts under
section 264(f)(4)(E), the addition of
covered lives is treated as a new
contract only for the additional covered
lives.
See sections 1035 and 264(f)(4)(E) for
more information.

How To File
Attach Form 8925 to the policyholder’s
income tax return for each tax year
ending after November 13, 2007,
during which the policyholder has
employer-owned life insurance
contract(s) in force.

Recordkeeping
You must keep adequate records to
support the information reported on Form
8925.

3. Receive written consent from the
employee. See Valid consent under the
instructions for line 4a.

Specific Instructions

Who Must File

Name of Policyholder

Generally, every policyholder owning
one or more employer-owned life

Enter the name of the policyholder
(defined earlier).

For Paperwork Reduction Act Notice, see page 2.

Cat. No. 37737A

Form

8925

(1-2008)

Page

Form 8925 (1-2008)

Identifying Number

Paperwork Reduction Act Notice

The identifying number of an individual
is a social security number. For all
other taxpayers, it is an employer
identification number.

We ask for the information on this
form to carry out the Internal Revenue
laws of the United States. You are
required to give us the information.
We need it to ensure that you are
complying with these laws and to
allow us to figure and collect the right
amount of tax.

Type of Business
Enter the policyholder’s trade or
business activity.

Line 4a
Valid consent. Before the issuance of
the employer-owned life insurance
contract, the employee must provide
written consent (a) to be insured under
the contract and (b) that coverage may
continue after the insured terminates
employment.

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.

2

The time needed to complete and
file this form will vary depending on
individual circumstances. The
estimated burden for individual
taxpayers filing this form is approved
under OMB control number 1545-0074
and is included in the estimates
shown in the instructions for their
individual income tax return. The
estimated burden for all other
taxpayers who file this form is shown
below.
Recordkeeping

2 hrs., 23 min.

Learning about the law or the
form
1 hr., 00 min.
Preparing the form

1 hr., 4 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. See the instructions for the
tax return with which this form is filed.