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Department of the Treasury
Internal Revenue Service
Instructions for Form

1099-SB

(Rev. December 2019)
Seller's Investment in Life Insurance Contract

Section references are to the Internal Revenue Code Regulations section 1.101-1(c)(2). The acquisition of an
unless otherwise noted. interest in a partnership, trust, or other entity that holds an
interest in a life insurance contract may be an indirect
Future Developments acquisition of that interest in a life insurance contract and
For the latest information about developments related to may be a reportable policy sale. See Regulations section
Form 1099-SB and its instructions, such as legislation 1.101-1(e)(3)(ii).
enacted after they were published, go to IRS.gov/
In general, an issuer is any person that bears any part
Form1099SB.
of the risk with respect to a life insurance contract and any
Reminders person responsible for administering the contract,
including collecting premiums and paying death benefits.
In addition to these specific instructions, you should also
See Regulations section 1.6050Y-1(a)(8)(i). An issuer’s
use the current General Instructions for Certain
designee is also considered an issuer. See Regulations
Information Returns. Those general instructions include
1.6050Y-1(a)(8)(i) and (iv).
information about the following topics.
• Who must file. A seller is any person that holds an interest in a life
• When and where to file. insurance contract and transfers that interest, or any part
• Electronic reporting. of that interest, to an acquirer in a reportable policy sale or
• Corrected and void returns. that owns a life insurance contract and transfers title to,
• Statements to recipients. possession of, or legal ownership of that contract to a
• Taxpayer identification numbers (TINs). foreign person. See Regulations section 1.6050Y-1(a)
• Backup withholding. (18).
• Penalties.
An acquirer is any person that acquires an interest in a
• Other general topics.
life insurance contract (through a direct acquisition or
You can get the general instructions from General indirect acquisition of the interest) in a reportable policy
Instructions for Certain Information Returns at IRS.gov/ sale. See Regulations section 1.6050Y-1(a)(1).
1099GeneralInstructions or go to IRS.gov/Form1099SB.
Who Must File
Continuous-use form and instructions. Form 1099-SB
Generally, file Form 1099-SB if you are the issuer of a life
and these instructions have been converted from an
insurance contract and either of the following occurs. See
annual revision to continuous use. Both the form and its
Regulations sections 1.6050Y-3(a) and 1.6050Y-1(a)(8)
instructions will be updated as needed. For the most
(iii).
recent version, go to IRS.gov/Form1099SB.
• You receive a statement from an acquirer in a
Online fillable Copies B and C. To ease statement reportable policy sale provided under section 6050Y(a),
furnishing requirements, Copies B and C have been made such as a copy of a Form 1099-LS, Reportable Life
fillable online in a PDF format available at IRS.gov/ Insurance Sale, reporting the transfer of the life insurance
Form1099SB. You can complete these copies online for contract, or an interest therein, in a reportable policy sale.
furnishing statements to recipients and for retaining in • You receive, from a source other than the issuer
your own files. responsible for administering the life insurance contract
(or its designee), notice of a transfer of the life insurance
Specific Instructions contract to a foreign person. In general, notice of a
transfer to a foreign person means any notice that you
This form is used by the issuer of a life insurance contract
receive of a transfer of title to, possession of, or legal
(also known as a life insurance policy) to report the
ownership of a life insurance contract that includes foreign
seller’s investment in the contract and surrender amount
indicia, including information provided for nontax
with respect to an interest in a life insurance contract
purposes such as a change of address notice for purpose
transferred in a “reportable policy sale” or transferred to a
of sending statements or for other purposes, or
foreign person.
information relating to loans, premiums, or death benefits
In general, a reportable policy sale is any direct or with respect to the contract, unless you know that no
indirect acquisition of any interest in a life insurance transfer of the contract has occurred or know that the
contract if the acquirer, at the time of the acquisition, has transferee is a U.S. person. See Regulations section
no substantial family, business, or financial relationship 1.6050Y-1(a)(10). However, if you are not the issuer
with the person insured under that contract, apart from the responsible for administering the life insurance contract,
acquirer’s interest in such life insurance contract. See including collecting premiums and paying death benefits
section 101(a)(3). Certain exceptions may apply. See under the contract on the date the notice is received, you

Nov 20, 2019 Cat. No. 71419D

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are not required to file Form 1099-SB if you or your section 1.6050Y-1(a)(7). Accordingly, with respect to any
designee provide the issuer responsible for administering seller other than the original policyholder, the issuer’s
the life insurance contract (or its designee) with such obligation to report the seller’s investment in the contract
notice and with any available information necessary to on any date will be limited to the information that is known
accomplish reporting on the Form 1099-SB. See to the issuer.
Regulations section 1.6050Y-1(a)(8)(iii)(B). You may not
have to file Form 1099-SB if you qualify for an exception in Surrender Amount
Regulations section 1.6050Y-3(f) or if another issuer or In general, the surrender amount is the amount the seller
third party information reporting contractor reports on your would have received from the issuer responsible for
behalf under the unified reporting provisions of administering the life insurance contract if the seller had
Regulations section 1.6050Y-3(b). You may qualify for an surrendered the life insurance contract to the issuer on the
exception in Regulations section 1.6050Y-3(f) if the seller date of the reportable policy sale or the transfer of the
is a foreign beneficial owner, if you receive notice of a contract to a foreign person. See Regulations section
transfer to a foreign person but did not receive a written 1.6050Y-3(a)(3).
statement from an acquirer reporting the transfer as a
reportable policy sale, or you received a written statement Statement to Seller
from an acquirer reporting your issuance of a life If you are required to file Form 1099-SB, you must furnish
insurance contract in a section 1035 exchange as a a statement or acceptable substitute to the seller, such as
reportable policy sale. Copy B of Form 1099-SB. For more information about the
Enter your name, address, telephone number, and TIN. requirement to furnish a statement to the seller, see part
Additionally, enter the name and telephone number of M in the current General Instructions for Certain
your information contact, if different from your own. This Information Returns.
contact information must provide direct access to a The issuer's information contact name must be
person who can answer questions about this information ! provided in the appropriate box. The individual
return. The information contact may be a call center CAUTION named must be familiar with the reporting
providing access to a person who can answer such requirements of reportable policy sales.
questions.
Truncating recipient’s TIN. Pursuant to Regulations
Reporting section 301.6109-4, all filers of this form may truncate the
You must file a separate Form 1099-SB for each seller of seller’s TIN (social security number (SSN), individual
an interest in a life insurance contract with respect to taxpayer identification number (ITIN), adoption taxpayer
which you received a statement provided under section identification number (ATIN), or employer identification
6050Y(a) or for each seller of a life insurance contract with number (EIN)) on statements furnished to a seller (Copy
respect to which you received notice of a transfer to a B). Truncation is not allowed on any documents the filer
foreign person. Enter the name, address, and TIN of the files with the IRS. An issuer’s TIN may not be truncated on
seller; the policy number of the life insurance contract; the any form. See part J in the current General Instructions for
seller’s investment in the contract; and the surrender Certain Information Returns.
amount.
Rescission of Reportable Policy Sale
Policy Number If a reportable policy sale or transfer of an insurance
The policy number is the unique identifying number contract to a foreign person is rescinded and you have
assigned to the life insurance contract by the issuer filed Form 1099-SB with respect to the reportable policy
responsible for administering the contract. sale or transfer, you must file a corrected Form 1099-SB
within 15 calendar days of the receipt of notice of the
Seller’s Investment in the Contract rescission. If a reportable policy sale or transfer of an
Investment in the contract means, with respect to the insurance contract is rescinded and you have furnished a
original policyholder of a life insurance contract, the statement with respect to the reportable policy sale or
aggregate amount of premiums or other consideration transfer to a seller, you must furnish the recipient of the
paid for the contract, less the aggregate amount received statement with a corrected statement within 15 calendar
under the contract, to the extent that such amount was days of the receipt of notice of the rescission. See
excludable from gross income. See Regulations section Regulations section 1.6050Y-3(e).
1.6050Y-1(a)(7)(i). With respect to any other person,
investment in the contract means estimate of investment Box 1. Investment in Contract
in the contract, which is the aggregate amount of Enter the seller’s investment in the contract.
premiums paid for the contract by that person, less the
aggregate amount received under the contract by that Box 2. Surrender Amount
person, to the extent such information is known to or can Enter the surrender amount.
reasonably be estimated by the issuer. See Regulations

-2- Instructions for Form 1099-SB (Rev. 12-2019)

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