Life Insurance - A solution to Proposed Tax Law Changes
September 15th, 2021
Every election, the candidates, whether it be for local, state, or national elections, make campaign promises in the hopes of enhancing their ticket to get elected. While many campaign promises never come to fruition, the mere thought of some creates ripple effects throughout the economy. Proposed tax law changes seem to get the most attention in election years, and the past Presidential election certainly gained the attention of the American public. Let me make a couple of points before I get started; One, this article has no intention of engaging in a political debate nor does it endorse a political party, and Two, I am not a tax law attorney and encourage you to do your own research after reading
Are you familiar with “Step-Up In Basis”, Capital Gains, or Estate Tax? In layman’s terms, “Step-Up In Basis” is a tax shelter for Inheritors. One of the proposals from President Biden is to change the way Capital Gains Taxes are paid. Please read the following article for a clear understanding of what is being proposed and how it effects our clients and our economy, Stepped Up Basis Biden Tax Plan
After reading this article, you should have developed a clear understanding as to how Life Insurance can and is providing a solution to the proposed tax law changes. We are seeing a tremendous increase in life policies. It’s not only in the number of applications but in premium volume as well. Twelve months ago, we saw a great deal of small term applications go through, and it was easy to see this was a result of people feeling their mortality with the ongoing Pandemic. This year, life sales have transitioned from small term life applications to larger life applications with heavier premiums providing a permanent death benefit. If you are a life licensed agent and have clients with high net worth, you should recognize the opportunity here. Life insurance is a very suitable solution to protect inheritors from proposed higher tax burdens. Remember, Life Insurance pays a tax-free benefit and would certainly make a great solution to a higher tax burden.
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