– Including Wealthy U.S. Families
PPLI’s Beautiful Architecture
Our next few articles will comprise an in-depth look at the five main components of our PPLI Concept Map: Professor PPLI meets Leonardo da Vinci.
What does beauty have to do with Private Placement Life Insurance (PPLI)? This is what we will explore in our article today. The tax compliant, conservative PPLI structuring techniques employed by Advanced Financial Solutions, Inc. have their own language of beauty which Leonardo da Vinci exemplified visually in his painting techniques.
We will also answer the question: why it is important for U.S. families, as well as wealthy international families that have a connection to the U.S., to use a life insurance company based in Bermuda, Barbados, or other offshore location that uses a 953(d) election? This PPLI structure offers these families the most advanced, yet fully compliant, asset structuring possibilities that are available. It is not a question of onshore vs. offshore, but what lies between as we will reveal in our article.
How is this connected to Leonardo da Vinci? It is connected to his painting technique called chairocurso or sfuamto. It came from his attention to the area between light and dark.
In the first panel of our Concept Map we explored the dark smoke that comes out of the backyard barbeque. In this article we will concentrate on the area that is between light and dark.
The Encylopedia of Fine Art gives us this definition of sfumato as:
“ In fine art, the term “sfumato” (derived from the Italian word fumo, meaning “smoke”) refers to the technique of oil painting which colours or tones are blended in such a subtle manner that they melt into one another without perceptible transitions, lines or edges. Leonardo da Vinci (1452-1519) himself described sfumato as a blending of colours “without lines or borders, in the manner of smoke.” It is as if a veil of smoke has been placed between the painting and the viewer, toning down the bright areas and lightening the dark ones, so as to produce a soft, imperceptible transition between the differing tones. Typically involving the use of a number of translucent glazes to create a gradual tonal spectrum from dark to light, Sfumato is classified as one of four painting modes of Renaissance art, the others being Unione, Cangiante, and Chiaroscuro.”
PPLI: The Unifying Structure
So what is between light and dark? In English, the word between comes from the Old English word betweonum, meaning “in the space which separates or midway.” What we call the region between light and dark is in reality a unifying factor. This will be seen more clearly shortly when we delineate the winning combination of entities called: The Unifying Structure.
Wouldn’t your planning possibilities increase many fold if you were considered a U.S. person just for federal income tax purposes, but not regulated by the U.S. Securities and Exchange (SEC)? Remember a PPLI death benefit is exempt from federal income tax purposes. The assets inside a properly structured PPLI policy are shielded from all taxation. If the policy is not under the regulation of the SEC, you can invest in almost any asset that can be held by a trust company:
- Real estate
- PFICs, PFHCs, CFCs
- Closely held companies
- Operating businesses, if structured properly
- Image rights
- Patents and trademarks
- Stock portfolios
- Art and collectibles
Yes, you do have the best of two worlds! If you are subject to the U.S. tax system, this combination of an insurance company based in Barbados, Bermuda, or similar jurisdiction that has a 953(d) election, is very much worth your consideration.
In our next article, Part 4, we will give you more detail on the 953(d) election. The Unifying Factor exists when the structure takes advantage of using the insurance regulations of a country like Barbados, Bermuda, or other country that has constructed its insurance code to accommodate the most advanced possibilities of PPLI. When this is combined with a 953(d) election one achieves The Unifying Factor.
Let us see how light and dark is seen from the standpoint of physics courtesy of Astroquizzical from Jillian Scudder, “Can light exist without darkness.”
“To the great dismay of the great existentialist thinkers, scientifically speaking, this is not that difficult a question to tackle.
From a physics perspective, “light” is just a series of particles zooming through space, a little beam of radiation heading outwards in the cosmos. An individual particle of light usually doesn’t care whether it’s surrounded by lots of other photons, or whether it is off on its own in the universe, traveling a unique path.
Darkness is usually described simply as the absence of light; this description also works pretty well as a physical description. By this standard, “light” and “darkness” are just a binary toggle between “radiation” or “not radiation”.
The question here is asking if you can have only radiation – only light – and skip the “no radiation” part entirely. If you remove darkness, could you still have light? If you’re thinking about darkness and light in terms of a yes/no toggle, then this is perfectly possible. You just hold the toggle at “yes” at all times. The individual light particles won’t care that they’re not letting “not radiation” not have its times – they’re simply travelling forwards.
The ways that our universe produces light are also independent on a lack of light nearby. Stars form light as a byproduct of the incredible pressures at their centers, and are most often formed in clusters – with tens to hundreds of other stars forming nearby. New stars only unveil themselves to our eyes by using the light they give off to burn away the dust and gas that hid them in darkness.
There are two major reasons for darkness in the universe. The first is to be in shadow. The physical blocking of light by an object is an easy way to be in darkness. That’s all night is on Earth, after all – you’re in the shadow of the planet. The second is that the universe hasn’t existed for an infinite amount of time. If the universe had already existed for an infinite amount of time, our skies would be brilliant with light both day and night, as the light from every star in the universe streamed towards us, brightening our skies. In that case, the only sources of darkness would be the shadows. In that universe, perhaps we would be asking the question the other way around – is there any darkness without the light?”
Our last analogous article shows us light and dark in the realm of symbolism courtesy of the Pen & the Pad, “Dark & Light Symbolism in Literature,” by Diane Kampf.
“Symbolism is the use of imagery to emphasize deeper meanings and emotions. Two common symbols used in literature are darkness and light. Darkness is often used to convey negativity: evil, death or the unknown. Light is used to convey something positive: goodness, life or hope. Some of the most-studied literature contains symbolic uses of darkness and light.”
It could be argued that the Bible serves as the basis for almost all themes found in Western literature. At the heart of biblical themes is the concept of good vs. evil. Goodness is often portrayed as some element of light. In Genesis, God creates light and calls it good. In the New Testament, Jesus himself is described as the light of the world. The visions of heaven described in the Revelation of John contain imagery of light.
Most academic studies in literature include at least one play by Shakespeare and dark and light symbolism abound in many of his works. In “Macbeth,” darkness is used a number of times to symbolize death. The famous line, “Out, out brief candle,” refers to Lady Macbeth’s suicide. Banquo’s torch is extinguished at the moment of his death. In “Romeo and Juliet,” light is used to show Juliet’s beauty and her dazzling influence on Romeo. When Romeo first sees Juliet, he says, “O, she doth teach the torches to burn bright!” (Act I, scene 5, line 45) Even when she dies, her brightness endures. When Romeo finds her in the tomb, he says,
“A grave? O, no, a lantern, slaughtered youth, For here lies Juliet, and her beauty makes This vault a feasting presence full of light ” (Act V, scene 3. lines 84-86)”
We opened our article discussing beauty–and we have not forgotten it. More on beauty in Part 4. We look forward to your comments, and assisting you with your clients that can benefit from PPLI structuring. Please let us know how we can help you!
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