Instr for Form 1099-LS--2019-12-00

Instructions for Form
1099-LS

Department of the Treasury
Internal Revenue Service

(Rev. December 2019)

Reportable Life Insurance Sale
reportable policy sale. See Regulations section 1.101-1(e)
(3)(ii).

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

Future Developments

For the latest information about developments related to
Form 1099-LS and its instructions, such as legislation
enacted after they were published, go to IRS.gov/
Form1099LS.

Reminders

In addition to these specific instructions, you should also
use the current General Instructions for Certain
Information Returns. Those general instructions include
information about the following topics.
• Who must file.
• When and where to file.
• Electronic reporting.
• Corrected and void returns.
• Statements to recipients.
• Taxpayer identification numbers.
• Backup withholding.
• Penalties.
• Other general topics.
You can get the general instructions at IRS.gov/
1099GeneralInstructions or go to IRS.gov/Form1099LS.

Continuous-use form and instructions. Form 1099-LS
and these instructions have been converted from an
annual revision to continuous use. Both the form and
instructions will be updated as needed. For the most
recent version, go to IRS.gov/Form1099LS.
Online fillable Copies B, C, and D. To ease statement
furnishing requirements, Copies B, C, and D have been
made fillable online in a PDF format available at IRS.gov/
Form1099LS. You can complete these copies online for
furnishing statements to recipients and for retaining in
your own files.

General Instructions

This form is used by the acquirer of any interest in a life
insurance contract (also known as a life insurance policy)
in a reportable policy sale to report the acquisition. In
general, a reportable policy sale is any direct or indirect
acquisition of any interest in a life insurance contract if the
acquirer, at the time of the acquisition, has no substantial
family, business, or financial relationship with the person
insured under that contract, apart from the acquirer’s
interest in such life insurance contract. See section 101(a)
(3). Certain exceptions may apply. See Regulations
section 1.101-1(c)(2). The acquisition of an interest in a
partnership, trust, or other entity that holds an interest in a
life insurance contract may be an indirect acquisition of
that interest in a life insurance contract and may be a
Nov 20, 2019

Who Must File

Generally, file Form 1099-LS if you are the acquirer of any
interest in a life insurance contract in a reportable policy
sale.
An acquirer is any person that acquires an interest in a
life insurance contract (through a direct acquisition or
indirect acquisition of the interest) in a reportable policy
sale.
You may not have to file Form 1099-LS if the interest in
a life insurance contract was transferred to you
gratuitously, if you qualify for an exception in Regulations
section 1.6050Y-2(f), or if another acquirer or third party
information reporting contractor reports on your behalf
under the unified reporting provisions of Regulations
section 1.6050Y-2(b). You may qualify for an exception in
Regulations section 1.6050Y-2(f) if you are a foreign
person, if you report reportable policy sale payments
made to a person other than the seller under section 6041
or 6041A, or if you acquire a life insurance contract in a
section 1035 exchange.
If you are the acquirer, enter your name, address,
telephone number, and taxpayer identification number
(TIN). Additionally, enter the name, address, and
telephone number of your information contact, if different
from your own. This contact information must provide
direct access to a person who can answer questions
about this information return.

Reporting

If you are the acquirer, you must file a separate Form
1099-LS for each payment recipient with respect to each
interest in a life insurance contract you acquired in a
reportable policy sale. Enter the name, address, and
taxpayer identification number (TIN) of the payment
recipient, the name of the issuer of the life insurance
contract, the policy number of the life insurance contract,
the amount paid to the payment recipient, and the date of
the sale. See Regulations section 1.6050Y-2.

Payment Recipient

In general, a reportable policy sale payment recipient
(payment recipient) is any person that receives a
reportable policy sale payment in a reportable policy sale.
A payment recipient may include any seller in the
reportable policy sale (any person that holds an interest in
a life insurance contract and transfers that interest, or any
part of that interest, to an acquirer in a reportable policy
sale), as well as any broker or other intermediary that
retains a portion of the cash or other consideration
transferred in the reportable policy sale. See Regulations

Cat. No. 71418S

For more information about the requirement to furnish a
statement to the payment recipient and the issuer, see
part M in the current General Instructions for Certain
Information Returns.

section 1.6050Y-1(a)(16)(i) for the definition of a
reportable policy sale payment recipient and section
1.6050Y-1(a)(18)(i) for the definition of seller. However, a
person other than a seller is not a payment recipient if that
person received aggregate payments of less than $600
with respect to a reportable policy sale. See Regulations
section 1.6050Y-1(a)(16)(ii).

Truncating recipient’s TIN on payment recipient
statements. Pursuant to Regulations section
301.6109-4, all filers of this form may truncate the
payment recipient’s TIN (social security number (SSN),
individual taxpayer identification number (ITIN), adoption
taxpayer identification number (ATIN), or employer
identification number (EIN)) on statements furnished to a
payment recipient (Copy B). Truncation is not allowed on
any documents the filer files with the IRS. An acquirer’s
TIN may not be truncated on any form. See part J in the
current General Instructions for Certain Information
Returns.

Issuer

The issuer is the person responsible for administering the
life insurance contract, including collecting premiums and
paying death benefits under the contract, on the date a
Form 1099-LS is required to be furnished under section
6050Y(a), or their designee. See Regulations section
1.6050Y-1(a)(8)(i), (ii), and (iv).

Policy Number

The policy number is the unique identifying number
assigned to the life insurance contract by the issuer
named on the Form 1099-LS.

Rescission of Reportable Policy Sale

If a reportable policy sale is rescinded and you have filed
a Form 1099-LS with respect to the reportable policy sale,
you must file a corrected Form 1099-LS within 15
calendar days of the receipt of notice of the rescission. If a
reportable policy sale is rescinded and you have furnished
a statement with respect to the reportable policy sale to a
payment recipient or issuer, you must furnish the recipient
of that statement with a corrected statement within 15
calendar days of the receipt of notice of the rescission.
See Regulations section 1.6050Y-2(e).

Statements to Payment Recipient and Issuer

If you are required to file Form 1099-LS, you must
generally furnish a statement or acceptable substitute to
each payment recipient and to the issuer, as shown in the
table below. The requirement to furnish a statement to the
issuer applies only with respect to a Form 1099-LS filed
with respect to the seller and only if your acquisition of an
interest in a life insurance contract in a reportable policy
sale is a direct acquisition. See Regulations section
1.6050Y-2(d)(2)(i). Statements furnished to the issuer
should be directed to the administrative office that,
pursuant to the life insurance contract, processes
transfers of ownership. You may not have to furnish
statements to the payment recipient and issuer if another
acquirer or third party information reporting contractor
reports on your behalf under the unified reporting
provisions of Regulations section 1.6050Y-2(b).
IF the statement is for the...

THEN use...

Payment recipient

Copy B

Issuer

Copy C

Specific Instructions
Box 1. Amount Paid to Payment Recipient

Enter the total amount paid to the payment recipient in the
reportable policy sale. The acquirer is not required to
report this information to the issuer of the life insurance
contract. Reporting the amount paid to the payment
recipient is therefore optional on Copy C.

Box 2. Date of Sale

Enter the date of the reportable policy sale.

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Instructions for Form 1099-LS (Rev. 12-2019)