What Does Having a Pre-Existing Condition Mean for Your Life Insurance?
It’s a common misconception that having a pre-existing condition means that you automatically do not qualify for life insurance. The good news is this is not always the case and armed with a good life insurance agent, many individuals with pre-existing conditions get approved for insurance. The path to being insured just may look a little different for someone with a medical condition.
Key Person Insurance
Thanks to their size, small businesses usually rely on a few key people to keep operations running smoothly. Whether it is a front-line supervisor that runs the crews, a senior leader for slightly larger business, or the founder and owner of a company, the absence of key people can really cripple short-term results which can potentially place long-term business viability at risk.
Key Person Insurance is a risk management tool that helps to cover the loss of a valued contributor due to death or disability.
Using Corporate Owned Life Insurance to Reduce Passive Income Taxation
Effective January 2019, new tax rules will come into effect that will have a dramatic impact on some small business owners. Starting in 2019, the Small Business Deduction Limit will be reduced by $5 for each $1 of passive income that exceeds $50,000 and will reach zero once $150,000 of passive income is earned in a year. This new tax rule may be leaving business owners wondering how they can redirect a portion of excess cash flow that would traditionally produce passive income, and subsequently some unfavorable tax consequences.
Corporate owned life insurance can offer a “two bird one stone” solution to business owners. If used appropriately, strategies such as these are a viable option for a private corporation with a substantial amount of excess income and a life insurance need. The information below provides an elementary overview of how life insurance can be used to defer tax and grow the corporation’s estate.
Private Corporations Dodge a Bullet with the 2018 Federal Budget
The Liberal Government’s Federal Budget was delivered by Finance Minister, Bill Morneau, on February 27, 2018. There had been much concern and speculation about the direction the budget would take with respect to the taxation of private corporations. This was due to a release of the Department of Finance in July 2017 which contained private corporation tax proposals which addressed areas of concern to the government involving, among other things, business owners holding passive investments inside of their corporation. There was speculation that if these proposals were implemented the effective tax rate on investment income earned by a private corporation and distributed to its shareholders could increase astronomically. Thankfully, the concerns voiced by business and professional groups following the July proposals were effective in moderating the government’s actions.
Are Life Insurance Premiums Ever Tax Deductible?
Considering that the proceeds of a life insurance policy are received tax free upon the death of the life insured, it is not surprising that …
Private Corporations in the Cross Hairs
If you are the owner of a private corporation you should be concerned about the commentary that is coming from the Department of Finance. In …
Insurance Audit for the Business Owner
Many business owners understand the important role that life insurance plays in effective corporate planning. Whether it is the funding of a shareholders’ agreement, life …
Life Insurance and the Capital Dividend Account
Many business owners are unaware that corporate owned life insurance combined with the Capital Dividend Account (CDA) provides an opportunity to distribute corporate surplus on …
The Corporate Estate Transfer
If you are the owner of a successful company it is likely that you have retained profits or surplus cash in your corporation. If this …
The Clock is Ticking!
Don’t Put Off Your Decision to Buy Life Insurance 2016 is an opportune year to buy life insurance. New laws affecting the taxation of life …
