[ValerieUSA]

from the article:
Wal-Mart borrowed money from the insurers to pay the premiums, which the company was able to write off as a business expense on its federal taxes.

[tdscpa]

Well, the article says the IRS disallowed Camelot's tax deduction. Perhaps the IRS did not catch Wal-Mart, yet, since they are apparently hiding this from everyone.

[wardaddy]

The following is from a site called smbix.com:

Premiums on certain life insurance: You can deduct premiums on life insurance policies if the corporation is the beneficiary. That applies to term life and premiums on keyman whole life policies to the extent they exceed the increase in the cash surrender value.

I'm sure like all tax code there is plenty of ambiguity in the big picture which will naturally benefit the IRS.

Ironically, I'm meeting my tax/financing advisor tommorow and will ask him. My bank is waffling over carrying a construction loan to commercial perm at prime(payments to be set fixed on todays rate..4.62%) for a 5 year balloon.(20 year amor.) No suprise there...LOL. They don't want to get "upside down" if rates rise which of course they will eventually. I asked my banker if he would have given me the same consideration had the prime risen in his favor during the construction loan term period. LOL...Banks...can't live with 'em...can't live without 'em...at least not in commerical real estate development. Scalawags.

tdspca:, I'm not questioning your knowledge...I just want to know more about this.

Regards.

[tdscpa]

Note the last line of the article: Wal-Mart has cancelled its policies...

Perhaps they discovered they can not deduct the premiums and can therefore not justify the program on economic grounds.