Can I deduct life insurance premiums?

July 09, 2019 by Frank Thomas, EA
Family under umbrella that says Life Insurance

Life insurance premiums are generally not deductible on your tax return. This is because the IRS considers it a personal expense. However, there are few exceptions, such as life insurance premiums paid by a business for its employees may be deductible as a business expense of the business, provided the business is not a beneficiary of the life insurance policy or benefits from the policy in any way and certain other conditions are met. A beneficiary is the individual or entity who receives the death benefit money in the event of death. On a positive note, generally the death benefit money received by a beneficiary due to the death of an individual is tax-free.

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Frank Thomas, EA
Tax Content Developer

 

Frank began his career at TaxAudit in 2005 as a Return Reviewer. Analyzing thousands of self-prepared tax returns every year for the next five tax seasons exposed him to many complicated areas of the tax code, and he became an expert at spotting the multitude of mistakes that can be made when preparing tax returns. His current position with the company is Tax Content Developer. In this role, he helps to ensure the soundness of the tax positions taken by our reps in their responses to the IRS and develops tax courses for our continuing education program. He is a member of the Research Team and has been instructing tax classes since 2009. With a career in the tax field spanning more than 20 years, Frank has owned and operated his own business, Thomas Tax Service, since 1991. Prior to working in taxes, Frank had a career in the banking industry. 


 

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