Does Life Insurance Have Any Tax Benefits?

According to IRS regulations, certain investment income is tax deferred, including the accumulation of funds through IRA’s, 401K, and similar retirement plans, along with life insurance. Unfortunately, if you need to withdraw the retirement funds earlier, before retirement age, you lose those tax advantages. Even if you only withdraw the funds at retirement age, the deferred growth is then taxable. With life insurance and proper planning, these tax concerns do not apply.

Your life insurance funds will always accumulate on a tax deferred basis and when it is appropriate, after review with your advisors, you can withdraw funds also tax free. Finally, the life insurance death benefits are always tax free to your beneficiaries. With proper legal and tax guidance, you can even have these benefits removed from your personal estate.

Our independent insurance agency has years of experience working with clients and their lawyers and accountants to make sure their financial interests are protected. Contact us today to discuss how our knowledge and experience can benefit you.