4026 / When will a split dollar plan that is entered into before September 17, 2003 found to be “materially modified” so that it is governed by the 2003 regulations?

The 2003 regulations apply to split dollar arrangements entered into after September 17, 2003, and arrangements entered into on or before September 17, 2003, that are materially modified after September 17, 2003.¹ The final regulations provide a nonexclusive list of changes that will not be considered material modifications. This list includes:

(1) a change solely in premium payment method, for example, from monthly to quarterly;

(2) a change solely of beneficiary, unless the beneficiary is a party to the arrangement;

(3) a change solely in the interest rate payable on a policy loan;