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Employee Benefit Consulting
1555 West Oak Sreet
Suite 100
Zionsville, IN 46077
Phone: (317) 727-1175

Executive Bonus

• The employer pays a cash bonus to a key employee and receives a tax deduction for the bonus paid.
• The employee uses the bonus money to purchase a life insurance policy. In some cases the employer pays the premiums to the insurer.)
• The bonus amount is included in the employee's W-2 as additional income.
• The employee owns the life insurance policy, names the beneficiary(ies), and controls all rights to any available cash value accumulation and surrender values and other policy benefits.
• The employer retains no ownership rights or beneficial interest in the policy.

How it Works

*Tax advantages may be subject to the Alternative Minimum Tax which may cause taxes and penalties.

We recommend that you consult with your own tax or legal advisors for counsel about the concepts presented in these materials.  Neither the insurer nor your agent may give you legal or tax advice.