In PLR 201152014, the Revenue Service ruled on the consequences to two banks that contributed both separate account and general account “BOLI” policies to an LLC in exchange for membership interests. The IRS first determined that the transfers to the account would not generate taxable gain under the “investment company” rules. The IRS also ruled on the effect of the interest disallowance provisions of § 264(f) on both banks. In the case of the bank with an interest of less than 50 percent in the LLC, the IRS ruled that there would be no interest disallowance under § 264(f)(1) on account of the LLC’s holding policies – on current or former employees – with unborrowed policy cash values.