Common use of Modified Endowment Contract Tax Status Clause in Contracts

Modified Endowment Contract Tax Status. Unless and until you have given us a Written Request to accept a Modified Endowment Contract classification for your policy, the provisions of this Modified Endowment Contract Tax Status subsection apply to your policy. Under federal tax law, if the funding of a life insurance contract occurs too rapidly, it becomes a Modified Endowment Contract (“MEC”) and fails to qualify for certain favorable tax treatment as a result. This policy is intended to qualify as a life insurance contract that is not a MEC for federal tax purposes. To achieve these purposes, the provisions of this policy (including any rider or endorsement that does not specifically override this tax qualification provision) shall be interpreted to prevent this policy from being subject to such MEC treatment, despite any other provision to the contrary. At no time shall the amount of death benefit under this policy ever be less than the minimum amount needed to avoid such MEC treatment. We will not accept a payment as premium or otherwise which would cause the policy to become a MEC. The 7-Pay Premium, shown on Page 3.0, is used solely to determine the policy’s premium limits to avoid MEC treatment. Payment of one or more 7-Pay Premium amounts does not guarantee that the policy will never lapse, and additional premiums may be necessary to prevent the policy from lapsing in the future. If at any time the amounts paid under the policy exceed the limit for avoiding such MEC treatment, this excess amount, including any interest as determined under federal tax law, shall be removed from the policy as of the date of its payment, and any appropriate adjustment in the death benefit and/or Accumulated Value shall be made as of such date. This excess amount, including any interest, shall be refunded no later than 60 days after the end of the applicable contract year, as determined under federal tax law. If this excess amount is not refunded by the end of such 60-day period, the Death Benefit shall be increased retroactively and prospectively to the minimum extent necessary so that at no time is the Death Benefit ever less than the minimum amount necessary to avoid Modified Endowment Contract classification. In addition, the Accumulated Value will be reduced to reflect the increased Monthly Deductions resulting from such Death Benefit increase, starting on the date that the increase is effective. Any request that would change the Death Benefit or any other benefit or rider under the policy will not be processed if the change would cause the policy to be classified as a Modified Endowment Contract. Requested changes that could cause the policy to be classified as a Modified Endowment Contract include, but are not limited to, an elective reduction in the Face Amount, a Death Benefit Option change that would cause a reduction in the Face Amount, and a withdrawal that would cause a reduction in the Face Amount.

Modified Endowment Contract Tax Status. Unless and until you have given us a Written Request to accept a Modified Endowment Contract (“MEC”) classification for your policyPolicy, the provisions of this Modified Endowment Contract Tax Status subsection apply to your policyPolicy. Under federal tax law, if the funding of a life insurance contract occurs too rapidly, it becomes a Modified Endowment Contract (“MEC”) MEC and fails to qualify for certain favorable tax treatment as a result. This policy Policy is intended to qualify as a life insurance contract that is not a MEC for federal tax purposes. To achieve these purposes, the provisions of this policy Policy (including any rider or endorsement that does not specifically override this tax qualification provision) shall be interpreted to prevent this policy Policy from being subject to such MEC treatment, despite any other provision to the contrary. At If and while the provisions of this subsection apply to your Policy, at no time shall the amount of death benefit under this policy Policy ever be less than the minimum amount needed to avoid such MEC treatment. We will not accept a payment as premium or otherwise which would cause the policy Policy to become a MEC. The 7-Pay Premium, shown on Page 3.0the Policy Specifications, is used solely to determine the policyPolicy’s premium limits to avoid MEC treatment. Payment of one or more 7-Pay Premium amounts does not guarantee that the policy Policy will never lapse, and additional premiums may be necessary to prevent the policy Policy from lapsing in the future. If at any time the amounts paid under the policy Policy exceed the limit for avoiding such MEC treatment, this excess amount, including any interest as determined under federal tax law, shall be removed from the policy Policy as of the date of its payment, and any appropriate adjustment in the death benefit Death Benefit and/or Accumulated Value shall be made as of such date. This excess amount, including any interest, shall be refunded no later than 60 days after the end of the applicable contract year, as determined under federal tax law. If this excess amount is not refunded by the end of such 60-day period, the Death Benefit shall be increased retroactively and prospectively to the minimum extent necessary (e.g., to the end of any MEC 7-year test period) so that at no time is the Death Benefit ever less than the minimum amount necessary to avoid Modified Endowment Contract classification. In addition, the Accumulated Value will be reduced to reflect the any increased Monthly Deductions resulting from such Death Benefit increase, starting on the date that the increase is effective. Any request that would change the Death Benefit or any other benefit or rider under the policy Policy will not be processed if the change would cause the policy Policy to be classified as a Modified Endowment Contract. Requested changes that could cause the policy Policy to be classified as a Modified Endowment Contract include, but are not limited to, an elective reduction in the Total Face Amount, a Death Benefit Option change that would cause a reduction in the Total Face Amount, and a withdrawal that would cause a reduction in the Total Face Amount.

Modified Endowment Contract Tax Status. Unless and until you have given us a Written Request to accept a Modified Endowment Contract (“MEC”) classification for your policy, the provisions of this Modified Endowment Contract Tax Status subsection apply to your policy. Under federal tax law, if the funding of a life insurance contract occurs too rapidly, it becomes a Modified Endowment Contract (“MEC”) MEC and fails to qualify for certain favorable tax treatment as a result. This policy is intended to qualify as a life insurance contract that is not a MEC for federal tax purposes. To achieve these purposes, the provisions of this policy (including any rider or endorsement that does not specifically override this tax qualification provision) shall be interpreted to prevent this policy from being subject to such MEC treatment, despite any other provision to the contrary. At If and while the provisions of this subsection apply to your policy, at no time shall the amount of death benefit under this policy ever be less than the minimum amount needed to avoid such MEC treatment. We will not accept a payment as premium or otherwise which would cause the policy to become a MEC. The 7-Pay Premium, shown on Page 3.0, is used solely to determine the policy’s premium limits to avoid MEC treatment. Payment of one or more 7-Pay Premium amounts does not guarantee that the policy will never lapse, and additional premiums may be necessary to prevent the policy from lapsing in the future. If at any time the amounts paid under the policy exceed the limit for avoiding such MEC treatment, this excess amount, including any interest as determined under federal tax law, shall be removed from the policy as of the date of its payment, and any appropriate adjustment in the death benefit Death Benefit and/or Accumulated Value shall be made as of such date. This excess amount, including any interest, shall be refunded no later than 60 days after the end of the applicable contract year, as determined under federal tax law. If this excess amount is not refunded by the end of such 60-day period, the Death Benefit shall be increased retroactively and prospectively to the minimum extent necessary (e.g., to the end of any MEC 7-year test period) so that at no time is the Death Benefit ever less than the minimum amount necessary to avoid Modified Endowment Contract classification. In addition, the Accumulated Value will be reduced to reflect the any increased Monthly Deductions resulting from such Death Benefit increase, starting on the date that the increase is effective. Any request that would change the Death Benefit or any other benefit or rider under the policy will not be processed if the change would cause the policy to be classified as a Modified Endowment Contract. Requested changes that could cause the policy to be classified as a Modified Endowment Contract include, but are not limited to, an elective reduction in the Total Face Amount, a Death Benefit Option change that would cause a reduction in the Total Face Amount, and a withdrawal that would cause a reduction in the Total Face Amount.

Modified Endowment Contract Tax Status. Unless and until you have given us a Written Request to accept a Modified Endowment Contract (“MEC”) classification for your policy, the provisions of this Modified Endowment Contract Tax Status subsection apply to your policy. Under federal tax law, if the funding of a life insurance contract occurs too rapidly, it becomes a Modified Endowment Contract (“MEC”) MEC and fails to qualify for certain favorable tax treatment as a result. This policy is intended to qualify as a life insurance contract that is not a MEC for federal tax purposes. To achieve these purposes, the provisions of this policy (including any rider or endorsement that does not specifically override this tax qualification provision) shall be interpreted to prevent this policy from being subject to such MEC treatment, despite any other provision to the contrary. At no time shall the amount of death benefit Death Benefit under this policy ever be less than the minimum amount needed to avoid such MEC treatment. We will not accept a payment as premium or otherwise which would cause the policy to become a MEC. The 7-Pay Premium, shown on Page 3.0, is used solely to determine the policy’s premium limits to avoid MEC treatment. Payment of one or more 7-Pay Premium amounts does not guarantee that the policy will never lapse, and additional premiums may be necessary to prevent the policy from lapsing in the future. If at any time the amounts paid under the policy exceed the limit for avoiding such MEC treatment, this excess amount, including any interest as determined under federal tax law, shall be removed from the policy as of the date of its payment, and any appropriate adjustment in the death benefit Death Benefit and/or Accumulated Value shall be made as of such date. This excess amount, including any interest, shall be refunded no later than 60 days after the end of the applicable contract year, as determined under federal tax law. If this excess amount is not refunded by the end of such 60-day period, the Death Benefit shall be increased retroactively and prospectively to the minimum extent necessary (e.g., to the end of any MEC 7-year test period) so that at no time is the Death Benefit ever less than the minimum amount necessary to avoid Modified Endowment Contract classification. In addition, the Accumulated Value will be reduced to reflect the any increased Monthly Deductions resulting from such Death Benefit increase, starting on the date that the increase is effective. Any request that would change the Death Benefit or any other benefit or rider under the policy will not be processed if the change would cause the policy to be classified as a Modified Endowment Contract. Requested changes that could cause the policy to be classified as a Modified Endowment Contract include, but are not limited to, an elective reduction in the Face Amount, a Death Benefit Option change that would cause a reduction in the Face Amount, and a withdrawal that would cause a reduction in the Face Amount.

Modified Endowment Contract Tax Status. Unless and until you have given us a Written Request to accept a Modified Endowment Contract (“MEC”) classification for your policyPolicy, the provisions of this Modified Endowment Contract Tax Status subsection apply to your policyPolicy. Under federal tax law, if the funding of a life insurance contract occurs too rapidly, it becomes a Modified Endowment Contract (“MEC”) MEC and fails to qualify for certain favorable tax treatment as a result. This policy Policy is intended to qualify as a life insurance contract that is not a MEC for federal tax purposes. To achieve these purposes, the provisions of this policy Policy (including any rider or endorsement that does not specifically override this tax qualification provision) shall be interpreted to prevent this policy Policy from being subject to such MEC treatment, despite any other provision to the contrary. At no time shall If and while the provisions of this subsection apply to your Policy, the amount of death benefit under this policy ever Policy shall never be less than the minimum amount needed to avoid such MEC treatment. We reserve the right to amend this Policy from time to time to reflect any clarifications that may be needed or are appropriate to maintain such tax qualification for non-MEC treatment or to conform the Policy provisions to any applicable changes in such tax qualification requirements, as provided in the Code or any published IRS guidance relating thereto, without consent (where allowed by law). We will send you a copy of such amendment to you at your last known address. We will not accept a payment as premium or otherwise which would cause the policy Policy to become a MEC. The 7-Pay Premium, shown on Page 3.0the Policy Specifications, is used solely to determine the policyPolicy’s premium limits to avoid MEC treatment. Payment of one or more 7-Pay Premium amounts does not guarantee that the policy will never lapse, and additional premiums may be necessary to prevent the policy from lapsing in the future. If at any time the amounts paid under the policy exceed the limit for avoiding such MEC treatment, this excess amount, including any interest as determined under federal tax law, shall be removed from the policy as of the date of its payment, and any appropriate adjustment in the death benefit and/or Accumulated Value shall be made as of such date. This excess amount, including any interest, shall be refunded no later than 60 days after the end of the applicable contract year, as determined under federal tax law. If this excess amount is not refunded by the end of such 60-day period, the Death Benefit shall be increased retroactively and prospectively to the minimum extent necessary so that at no time is the Death Benefit ever less than the minimum amount necessary to avoid Modified Endowment Contract classification. In addition, the Accumulated Value will be reduced to reflect the increased Monthly Deductions resulting from such Death Benefit increase, starting on the date that the increase is effective. Any request that would change the Death Benefit or any other benefit or rider under the policy will not be processed if the change would cause the policy to be classified as a Modified Endowment Contract. Requested changes that could cause the policy to be classified as a Modified Endowment Contract include, but are not limited to, an elective reduction in the Face Amount, a Death Benefit Option change that would cause a reduction in the Face Amount, and a withdrawal that would cause a reduction in the Face Amount.MEC

Modified Endowment Contract Tax Status. Unless and until you have given us a Written Request to accept a Modified Endowment Contract (“MEC”) classification for your policyPolicy, the provisions of this Modified Endowment Contract Tax Status subsection apply to your policyPolicy. Under federal tax law, if the funding of a life insurance contract occurs too rapidly, it becomes a Modified Endowment Contract (“MEC”) MEC and fails to qualify for certain favorable tax treatment as a result. This policy Policy is intended to qualify as a life insurance contract that is not a MEC for federal tax purposes. To achieve these purposes, the provisions of this policy Policy (including any rider or endorsement that does not specifically override this tax qualification provision) shall be interpreted to prevent this policy Policy from being subject to such MEC treatment, despite any other provision to the contrary. At no time shall If and while the provisions of this subsection apply to your Policy, the amount of death benefit under this policy ever Policy shall never be less than the minimum amount needed to avoid such MEC treatment. We reserve the right to amend this Policy from time to time to reflect any clarifications that may be needed or are appropriate to maintain such tax qualification for non-MEC treatment or to conform the Policy provisions to any applicable changes in such tax qualification requirements, as provided in the Code or any published IRS guidance relating thereto, without consent (where allowed by law). We will send you a copy of such amendment to you at your last known address. We will not accept a payment as premium or otherwise which would cause the policy Policy to become a MEC. The 7-Pay Premium, shown on Page 3.0the Policy Specifications, is used solely to determine the policyPolicy’s premium limits to avoid MEC treatment. Payment of one or more 7-Pay Premium amounts does not guarantee that the policy Policy will never lapse, and additional premiums may be necessary to prevent the policy Policy from lapsing in the future. If at any time the amounts paid under the policy Policy exceed the limit for avoiding such MEC treatment, this excess amount, including any interest as determined under federal tax law, shall be removed from the policy Policy as of the date of its payment, and any appropriate adjustment in the death benefit Death Benefit and/or Accumulated Value shall be made as of such date. This excess amount, including any interest, shall be refunded no later than 60 days after the end of the applicable contract year, as determined under federal tax law. If this excess amount is not refunded by the end of such 60-day period, the Death Benefit shall be increased retroactively and prospectively to the minimum extent necessary (e.g., to the end of any MEC 7-year test period) so that at no time is the Death Benefit ever less than the minimum amount necessary to avoid Modified Endowment Contract classification. In addition, the Accumulated Value will be reduced to reflect the any increased Monthly Deductions resulting from such Death Benefit increase, starting on the date that the increase is effective. ICC15 P15PVA Any request that would change the Death Benefit or any other benefit or rider under the policy Policy will not be processed if the change would cause the policy Policy to be classified as a Modified Endowment Contract. Requested changes that could cause the policy Policy to be classified as a Modified Endowment Contract include, but are not limited to, an elective reduction in the Total Face Amount, a Death Benefit Option change that would cause a reduction in the Total Face Amount, and a withdrawal that would cause a reduction in the Total Face Amount.

Modified Endowment Contract Tax Status. Unless and until you have given us a Written Request to accept a Modified Endowment Contract (“MEC”) classification for your policyPolicy, the provisions of this Modified Endowment Contract Tax Status subsection apply to your policyPolicy. Under federal tax law, if the funding of a life insurance contract occurs too rapidly, it becomes a Modified Endowment Contract (“MEC”) MEC and fails to qualify for certain favorable tax treatment as a result. This policy Policy is intended to qualify as a life insurance contract that is not a MEC for federal tax purposes. To achieve these purposes, the provisions of this policy Policy (including any rider or endorsement that does not specifically override this tax qualification provision) shall be interpreted to prevent this policy Policy from being subject to such MEC treatment, despite any other provision to the contrary. At no time shall If and while the provisions of this subsection apply to your Policy, the amount of death benefit under this policy ever Policy shall never be less than the minimum amount needed to avoid such MEC treatment. We reserve the right to amend this Policy from time to time to reflect any clarifications that may be needed or are appropriate to maintain such tax qualification for non-MEC treatment or to conform the Policy provisions to any applicable changes in such tax qualification requirements, as provided in the Code or any published IRS guidance relating thereto, without consent (where allowed by law). We will send you a copy of such amendment to you at your last known address. We will not accept a payment as premium or otherwise which would cause the policy Policy to become a MEC. The 7-Pay Premium, shown on Page 3.0the Policy Specifications, is used solely to determine the policyPolicy’s premium limits to avoid MEC treatment. Payment of one or more 7-Pay Premium amounts does not guarantee that the policy Policy will never lapse, and additional premiums may be necessary to prevent the policy Policy from lapsing in the future. If at any time the amounts paid under the policy Policy exceed the limit for avoiding such MEC treatment, this excess amount, including any interest as determined under federal tax law, shall be removed from the policy Policy as of the date of its payment, and any appropriate adjustment in the death benefit Death Benefit and/or Accumulated Value shall be made as of such date. This excess amount, including any interest, shall be refunded no later than 60 days after the end of the applicable contract year, as determined under federal tax law. ICC19 P19VUL Page [27] If this excess amount is not refunded by the end of such 60-day period, the Death Benefit shall be increased retroactively and prospectively to the minimum extent necessary (e.g., to the end of any MEC 7-year test period) so that at no time is the Death Benefit ever less than the minimum amount necessary to avoid Modified Endowment Contract classification. In addition, the Accumulated Value will be reduced to reflect the any increased Monthly Deductions resulting from such Death Benefit increase, starting on the date that the increase is effective. Any request that would change the Death Benefit or any other benefit or rider under the policy Policy will not be processed if the change would cause the policy Policy to be classified as a Modified Endowment Contract. Requested changes that could cause the policy Policy to be classified as a Modified Endowment Contract include, but are not limited to, an elective reduction in the Total Face Amount, a Death Benefit Option change that would cause a reduction in the Total Face Amount, and a withdrawal that would cause a reduction in the Total Face Amount.

Modified Endowment Contract Tax Status. Unless and until you have given us a Written Request to accept a Modified Endowment Contract (“MEC”) classification for your policyPolicy, the provisions of this Modified Endowment Contract Tax Status subsection apply to your policyPolicy. Under federal tax law, if the funding of a life insurance contract occurs too rapidly, it becomes a Modified Endowment Contract (“MEC”) MEC and fails to qualify for certain favorable tax treatment as a result. This policy Policy is intended to qualify as a life insurance contract that is not a MEC for federal tax purposes. To achieve these purposes, the provisions of this policy Policy (including any rider or endorsement that does not specifically override this tax qualification provision) shall be interpreted to prevent this policy Policy from being subject to such MEC treatment, despite any other provision to the contrary. At no time shall If and while the provisions of this subsection apply to your Policy, the amount of death benefit under this policy ever Policy shall never be less than the minimum amount needed to avoid such MEC treatment. We reserve the right to amend this Policy from time to time to reflect any clarifications that may be needed or are appropriate to maintain such tax qualification for non-MEC treatment or to conform the Policy provisions to any applicable changes in such tax qualification requirements, as provided in the Code or any published IRS guidance relating thereto, without consent (where allowed by law). We will send you a copy of such amendment to you at your last known address. We will not accept a payment as premium or otherwise which would cause the policy Policy to become a MEC. The 7-Pay Premium, shown on Page 3.0the Policy Specifications, is used solely to determine the policyPolicy’s premium limits to avoid MEC treatment. Payment of one or more 7-Pay Premium amounts does not guarantee that the policy Policy will never lapse, and additional premiums may be necessary to prevent the policy Policy from lapsing in the future. If at any time the amounts paid under the policy Policy exceed the limit for avoiding such MEC treatment, this excess amount, including any interest as determined under federal tax law, shall be removed from the policy Policy as of the date of its payment, and any appropriate adjustment in the death benefit Death Benefit and/or Accumulated Value shall be made as of such date. This excess amount, including any interest, shall be refunded no later than 60 days after the end of the applicable contract year, as determined under federal tax law. If this excess amount is not refunded by the end of such 60-day period, the Death Benefit shall be increased retroactively and prospectively to the minimum extent necessary (e.g., to the end of any MEC 7-year test period) so that at no time is the Death Benefit ever less than the minimum amount necessary to avoid Modified Endowment Contract classification. In addition, the Accumulated Value will be reduced to reflect the any increased Monthly Deductions resulting from such Death Benefit increase, starting on the date that the increase is effective. Any request that would change the Death Benefit or any other benefit or rider under the policy Policy will not be processed if the change would cause the policy Policy to be classified as a Modified Endowment Contract. Requested changes that could cause the policy Policy to be classified as a Modified Endowment Contract include, but are not limited to, an elective reduction in the Total Face Amount, a Death Benefit Option change that would cause a reduction in the Total Face Amount, and a withdrawal that would cause a reduction in the Total Face Amount.