Two 2022 Announcements
MetLife Goes National With
Structured Installment Sales Program

and

My Article in The CPA Journal
January 13, 2022 - Since the statute of limitations has yet to run on using this greeting, let me start off by wishing all our faithful readers a very "Happy New Year!"

Some EXCEPTIONALLY exciting news to impart to you out of the box, to wit:

MetLife Expands SIS Program

After successfully piloting its Structured Installment Sale (SIS) program in a limited capacity and geographic area a little more than a year ago, MetLife just announced that it is formally extending availability of this tax-deferring option for use in all states (except New York) plus the District of Columbia and Puerto Rico.

For those unfamiliar with this concept, a structured installment sale permits sellers of qualifying appreciated assets (businesses and real estate typically) to receive their sales proceeds in guaranteed payments over time which protects their profits, defers taxes until payments are received, and is backed, in this case, by the financial strength of Metropolitan Tower Life.

If you follow our firm, you know we have been active advocates of structured installment sales for nearly two decades. (I placed my first structured installment sale in 2005) I have written about it (more on that in a minute) and have conducted live seminars and online, COVID-compliant webinars for realtors, investor groups, and organizations geared towards helping clients sell their businesses more tax-efficiently.

But when MetLife introduced its pilot program, we were downright giddy with excitement at the prospect of helping people benefit from this tax deferral strategy. People contemplating selling their businesses and real estate using the installment method could now do so with the transaction backed by one of the most well-capitalized financial institutions in the world.

Since then, we have successfully helped a number of clients in CA (one of the pilot states) defer recognition of capital gains when selling their businesses and property.

I'm Published in The CPA Journal
Speaking of SIS, The CPA Journal recently published an article I wrote, "An Introduction to Structured Installment Sales," in its October/November issue.

A publication credit from this prestigious magazine was not easily won. The grueling editorial process was more comprehensive than any I'd experienced previously - you can imagine the scrutiny of an editorial board comprised of accountants! - which made me feel doubly proud to have my effort validated by this esteemed periodical. From their website:

The CPA Journal is known as the “Voice of the Profession,” and is The New York State Society of CPA’s monthly flagship publication and top member resource. An award-winning magazine and finalist for excellence in journalism (2018, 2017 FOLIO magazine awards), The Journal has over 95% nationally focused content written by thought leaders in the accounting and finance industry.

The publication of this article coinciding with MetLife's announcement bodes well for our firm to continue its leadership position on this important strategy.
BTW, if you're interested in seeing how a typical structured installment sale might play out in the real world, here's a four-minute hypothetical case study from our YouTube Channel to give you an idea of how beneficial they can be:
NOT a Monetized Installment Sale

I would be remiss if I closed the discussion on this topic without making sure I clarified something especially important: Structured Installment Sales ARE NOT Monetized Installment Sales.

A Monetized Installment Sale has been called "flawed" by the IRS.

A Structured Installment Sale, on the other hand, clears the IRS hurdle since it must comply with all applicable sections of the Internal Revenue Code and relevant Revenue Rulings, including Publication 537.

In at least one instance, a client I was working with backed out of a MetLife Structured Installment Sale just before closing because a last-minute CPA hired to review the documents mistakenly believed he was entering into something called a "Monetized Installment Sale."

He was not.

Despite months of research, evaluation, and vetting leading to his ultimate decision to proceed confidently with a MetLife Structured Installment Sale, the client forfeited his opportunity to save thousands of dollars simply because his advisor misunderstood what he was entering into due to a similar sounding name.

I'm loath to give this monetized concoction too much publicity since that approach has (thankfully and rightfully) fallen under IRS scrutiny, but it's important for clients to understand the distinction.

Spread the Word

So, if you or anyone you know is ever contemplating buying or selling a business or highly appreciated real estate for a profit, please share the good word. A penny saved may be a penny earned, but a tax dollar deferred and reduced is money in your pocket. A structured installment sale is a straightforward, easy-to-implement method of helping sellers keep more of what they've accumulated.

Thank you for the opportunity to be of service and best wishes to you for continued success in your personal and professional lives. All good wishes for 2022 and beyond.
Dan Finn, CPCU, MSSC™, RICP®
Master's Certified Structured Settlement Consultant™
Retirement Income Certified Professional®

"Building lifetime client relationships!"
CA Insurance License: 0A96173