Taxes And Your Life Insurance CoverageArticle Posted by Expert Author: Adam Foley on 04/08/2013
Many people who are ready to choose a life insurance company don't associate this with their tax situation. But if you are looking for coverage and are in a high tax bracket, one type of life insurance may benefit you over another. For example, permanent insurance may work well for you due to the tax-deferred savings options. As well, your family will not have to wait to receive benefits such as they may with other investments.
Death benefits are not taxable, regardless of the type of life insurance policy you have purchased. But your life insurance policy will be added to your taxable estate. This means that as long as you can say you own your insurance policy and have paid the premiums as required, then any proceeds from your policy will be added to your other property when it comes time to determine your death taxes. You can leave up to $600,000 in property to your heirs without having to pay federal estate taxes.
For more information on understanding the industry, the providers available, and the types of benefits you will derive from purchasing a policy, check out our resource at http://www.lifeinsurancecompaniesbystate.com/.
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