Life Insurance Today
As a business person, would you like to...
Using life insurance and proper planning, just such assurances and leverage are possible in the areas of retirement, business succession, and estate planning.
If you are ready, our qualified life insurance specialists are prepared to assist you. Call us toll free at (800) 930-6162 or e-mail us at firstname.lastname@example.org
way to make life insurance premiums tax deductible
Employee benefits include ownership of policy cash value and insurance coverage paid largely, if not wholly, by the corporation. The employee is taxed on the bonus as ordinary income, but often receives a bonus on the bonus to pay the tax.
What corporation would let a star employee vacation for 2 years? Few, because the subordinates would be less likely to earn the profits the key employee earned the business. Also, there is a cost besides lost profits. Subordinates often make expensive mistakes learning to fill the key employee's position.
Typical business benefits of key person insurance include:
executive benefits of key person insurance include
Funding a buy-sell agreement occurs most often in one of five ways.
The insurance advantages are assurance of capital when needed to purchase an interest per the buy-sell agreement. Life insurance generally is cost effective compared to other methods. Life insurance is administratively simple compared to the other methods.
ways to fund a buy-sell agreement with insurance
The result can be cumbersome administratively if numerous owners require numerous policies. Also, where a great difference in age of insureds exists, the premiums paid by some partners will be disproportionate if like coverage is desired.
Tax consequences, including possible alternative minimum tax and income tax basis issues, of a buy/sell agreement vary depending on the form of business entity and the terms of the agreement. Using an attorney with specificity of knowledge is prudent in this area.
dollar life insurance funding
With split dollar a business can pay a portion of the premium and be reimbursed from either the death benefit or perhaps from policy cash values. Where an employee dies, an employer can recoup the premiums it paid from a death benefit. Where an employee lives or switches employers, the employee by agreement may be required to reimburse an employer for premium payments. If enough cash value exists, reimbursement may be accomplished by borrowing against the insurance policy's cash value.
Split dollar funding may utilize either the collateral assignment method or the endorsement method. There is even such a thing as reverse split dollar.
employee owned policy using collateral assignment
employer owned policy using the endorsement method
Please allow one of our qualified life insurance specialists to assist you in obtaining the information you want so you can make an informed decision. With one free phone call or an e-mail you can take the first step toward seeing if using life insurance is a good way for you to solve some of your business problems.
Using modern technology and traditional service we provide you with all the information you need to make the right decision for you. So call us Toll Free at 800-930-6162 or e-mail us at email@example.com
Or, to learn more about how life insurance can provide complete financial security for your family, protect your business, pay off your mortgage, or even pay your estate taxes, please visit Family Protection, Business Ins., Mortgage Ins. or Estate Plans.