Operations

3 Months Ended

Mar. 31, 2020

Life Partners IRA Holder Partnership, Llc

Entity Information [Line Items]

Operations

Operations

The Life Partners IRA Holder Partnership, LLC (the “IRA Partnership” or “Partnership”) was created on December 9, 2016, pursuant to the Revised Third Amended Joint Plan of Reorganization of Life Partners Holdings, Inc., et al. (the “Debtors”), dated as of October 27, 2016, which we call the “Plan,” that was confirmed by order of the United States Bankruptcy Court for the Northern District of Texas, Fort Worth Division (“Bankruptcy Court”) on November 1, 2016.

In connection with its formation and the inception of its activities on December 9, 2016, the Partnership issued limited liability company interests (“Member Interests”) in satisfaction of claims against the Debtors. The only assets of the Partnership are beneficial interest units of the Life Partners Position Holder Trust. The Partnership held 745,831,204 and 746,634,100 units as of March 31, 2020 and December 31, 2019, respectively, of the Trust’s outstanding units totaling 1,243,505,906 and 1,235,715,080 as of March 31, 2020 and December 31, 2019, respectively. The sole purpose of the Partnership is to hold Trust interests to permit holders of partnership interests to participate in distributions of the proceeds of the liquidation of the Trust. The Partnership was created to allow IRA holders to hold an interest in an entity classified as a partnership for federal tax purposes, rather than the assets of a grantor trust, such as the Trust. The Partnership’s sole asset is its investment in the Trust and it engages in no other business activity.

The Bankruptcy Court organized the Trust and the Partnership in order to liquidate the assets of the Debtors in a manner calculated to conserve, protect and maximize the value of the assets, and to distribute the proceeds thereof to the Trust’s securities holders in accordance with the Plan. The Trust and IRA Partnership have no other business interests nor operations and will not acquire any additional life insurance policies in the future. The Trust’s beginning assets and liabilities were contributed pursuant to the Plan as of December 9, 2016.

Covid-19 Pandemic Update

The novel coronavirus (COVID-19) outbreak did not have a material adverse effect on the Partnership's operations for the first quarter of 2020. The extent to which the Partnership will be impacted by the outbreak will largely depend on future developments, which are highly uncertain and cannot be accurately predicted, including new information which may emerge concerning the severity of the outbreak and actions by government authorities to contain the outbreak or treat its impact, among other things.

The Partnership does not believe the COVID-19 will have any material impact on timing of receipt of maturities. The Partnership will continue to monitor the impact of risk associated with default on future premium obligations by the continuing fractional holders which would increase the Partnership's premium obligations and any risk associated with default on payment obligations by the insurance policy carriers.