One of my favorite ballads from the decade of the 1960's is "This Magic Moment" by Jay and the Americans. It is a quintessentially American song that defines that era. Growing up outside of the U. S. in the Panama Canal Zone, it helped me imagine my American experience, outside looking in.
My path in the law is equally circuitous. I worked in the life insurance industry before, during and after my time in law school. Somebody might say to me, "You don't need to drink the life insurance, Kool Aid". But what happens if everything that life insurance agents said about life insurance happens as Henry Kissinger said, and has the additional benefit of being true - (1) Tax-free inside build up of the cash value. (2) Tax-free distributions during lifetime through loans and withdrawals. (3) Income tax-free death benefit. (4) Estate tax-free death benefit. (5) In most cases protected from the claims of business and personal creditors. The magic show gets better after I tell you that the policy is institutionally priced with customized investment options and the death benefit is reinsured by the largest life insurers and reinsurers on the Planet.
The sky may or may not be falling but a few things seem to be certain. Personal income tax rates will increase sooner or later. The estate and gift tax exemption will decrease dramatically sooner than later. The rich get richer. Our depression like unemployment numbers mean that some people are suffering but not everyone. The economic conditions - good - or bad - create investment opportunities. Asset values are depressed creating investment opportunities. The investment opportunities look a lot better without the adverse impact of taxation of any sort at the cost of approximately one percent of your investment return. The impact of taxation is a lot more than even at long-term capital gains rates. You can build a fortune much more quickly if you can legally structure your investment strategies in the magic box - private placement life insurance (PPLI).
This is a magic moment. PPLI provides the path to accomplish your long-term investments without taxation, legally. In this story nobody goes to jail! The policy can be structured so that the policy is outside of the reach of creditors while you continue to benefit from tax-free distributions during your lifetime. The death benefit will be income and estate tax-free for your heirs. At the Law Office of Gerald R. Nowotny, we can put the "magic" back into your investment and tax planning!