Can life insurance be a tax deductible business expense?
This article was last updated:
This article was last updated:
Life insurance can be a tax deductible business expense in certain cases. For example, if the life insurance policy is taken out on a key employee, the premiums can be deducted as a business expense. Additionally, if the life insurance policy is used as collateral for a business loan, the interest on the loan may be deductible.
How to Deduct Life Insurance as a Business Expense
When is Life Insurance a Tax-Deductible Business Expense?
The benefits of deducting life insurance as a business expense include the potential to lower your taxable income, and the ability to use the death benefit to help cover business expenses in the event of your death. To maximize your business expenses by deducting life insurance, be sure to consult with a tax advisor to see if it makes sense for your specific business.
The death benefit paid to the beneficiaries is not subject to income tax. Additionally, the premiums paid for the policy are tax deductible. The tax benefits of life insurance can make it an attractive option for businesses.
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