Life Insurance Is The Ultimate Shield Against Estate Taxes
There is no denying that the Biden Administration will be making some tax-law changes in the future. The Administration has already suggested that they would like to reduce the Estate Tax Exclusion limits which currently sits at $11,580,000 per individual.
Depending on what the exclusion limit adjusts to, this simple tax change could impact a significant amount of our high-earning clients.
From 2011 to 2017 the Estate Tax Exclusion was $5 million (adjusted for inflation) and then jumped up dramatically in 2018 to $11,180,000. So, the question is purposed, what if the new Administration tries to re establish the $5 million limit? How many of our clients would have a serious estate tax issue?
The Solution
Permanent Life Insurance is an asset that can manage your client’s taxes, make sure they leave a legacy to their beneficiaries that will not be taxed at a 40% clip from the government, and provide them peace of mind with a level payment. The unique tax advantages of life insurance policies, when properly owned and funded by a Trust, could save families thousands of dollars in estate taxes.
As financial advisors we do not have a crystal ball but what we do know is funding a permanent life insurance policy now for the purpose of estate protection with the element of cash value accumulation provides your clients and their families flexibility to shield their net worth from bureaucrat changes happening today and in the future.
Please reach out to your RAM GROUP Life Sales Representative for more information.
Original author: Sean Farrell, 7-12-2021