- Life InsuranceLife Insurance is often the financial foundation for many families. An income tax free death benefit enables survivors to have the financial means to continue their current lifestyle and satisfy debt obligations. Term insurance is frequently used because it provides the largest amount of benefit for the smallest amount of premium. Term insurance often provides the best solution when obligations only last for a specified term of years. Obligations that can be satisfied by term life insurance include mortgage payments, child rearing and education expenses and survivor income. For more permanent needs whole life, universal life, or variable life insurance should be considered. These plans may be designed to provide a lifetime death benefit. Cash accumulates within the policy on a tax deferred basis and premium payments plus interest earnings on cash values are sufficient to keep a policy in force for a lifetime. In some cases, a tax-free income stream can be provided by these policies to assist in supplementing retirement income.
- Health InsuranceWhen deciding on and planning your wellness program, you also need to consider how the program is classified for the purpose of legal compliance. Based on regulations under the Health Insurance Portability and Accountability Act (HIPAA) and the Affordable Care Act (ACA), a wellness program can fall into one of two basic categories that determine what guidelines it must adhere to. These categories are participatory and health-contingent wellness programs, with the health-contingent category additionally broken into two subcategories: activity-only and outcome-based.
- Disability InsuranceIncome is the engine that powers most people’s standard of living. The loss of ability to earn a living can be devastating to an individual or family. Disability is one of the major causes of mortgage foreclosures and bankruptcy declarations. Protecting the wage earner’s income with disability insurance is essential for family security.
- Long Term CareAn increasingly popular benefit among executive personnel is Long Term Care (LTC) Insurance. In certain cases, an employer can tax deduct LTC premiums and the executive need not report the premiums or benefits as taxable income. It is rare to have this “mismatching†of premium and benefit taxation, particularly when it can also be accomplished on a discriminatory basis. To make LTC arrangements even more desirable, many carriers offer premium payment periods that end in 10 years or at age 65.
- Workers Compensation InsuranceSection 105 of the Internal Revenue Code provides a way to save taxes, for both employer and employee, through a Medical Expense Reimbursement Plan (MERP). Such a Plan should not be confused with a Flexible Benefits or Cafeteria Plan because they are two different programs. Section 105, a little known part of the tax code, allows a 100 percent deduction for health insurance and allows companies to write off other non-insured medical, dental and vision expenses as well. Employers and employees can save Federal Taxes, State Taxes, FICA, Medicare, Workers Compensation, Unemployment and State Disability Insurance payroll taxes – up to a 50% savings for some. While any company can take advantage of the plan, smaller companies, particularly self-employed individuals that can employ their spouse in their business, can benefit greatly. Howell works with employers to design and implement MERPs after assessing their needs.
- AnnuitiesFixed annuities are a reasonable option for many individuals. Carriers hold their fixed annuity’s internal rate of return for a specified period of time and income accrues on a tax deferred basis. The fixed rate is determined by the carrier based upon its projection of current market conditions. Most fixed annuity contracts include a guaranteed minimum rate. Some fixed annuities can have their interest crediting rate tied to an index like the S&P or DOW subject to various policy conditions.