PAYMENT OF LIFE INSURANCE PREMIUMS BY YOUR COPORATION

Once you incorporate, your corporation may pay your insurance premiums.

This strategy allows you to save money, even if premiums are not deductible in the corporation. Premiums are paid by the corporation with money taxed at 19% as opposed to 49% when paid by an individual. If the corporation is named as beneficiary of your policy, paying the premiums through the corporation will not incur any taxable benefits to you.

At death, money received by the corporation may be paid to the estate of the deceased professional tax free.

The tax to be paid to finance the purchase of the life insurance policy must be considered in order to determine the actual cost of the premium.

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