Free Form 8925 (Rev. January 2008) - Federal

Form

8925

Report of Employer-Owned Life Insurance Contracts
Attach to the policyholder's tax return--See instructions.

OMB No. 1545-2089

(January 2008)
Department of the Treasury Internal Revenue Service (99)

Name(s) shown on return

Attachment Sequence No. Identifying number

160

Name of policyholder, if different from above Type of business

Identifying number, if different from above

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 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

1

2 3

3 4a b

4b

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.

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

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.

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.

Specific Instructions
Name of Policyholder
Enter the name of the policyholder (defined earlier).
Form

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

For Paperwork Reduction Act Notice, see page 2.

Cat. No. 37737A

8925

(1-2008)

Form 8925 (1-2008)

Page

2

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

Paperwork Reduction Act Notice
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. 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.

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.

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.