NG Employee Benefits Savings and Insurance (NGEB)
Employee Benefits Programs
Leveraged / financed key staff benefits plans are dual benefit programs that combine a three-to-one savings component with permanent – universal life insurance. Highlights include:
- Tax-advantaged / tax-deferred growth. Because the savings component is combined with permanent universal life insurance, savings are able to grow tax-advantaged / tax-deferred under Internal Revenue Code 7702.
- Tax-free income / distribution options. Policy holder has access to tax-free loans from the carrier who issued the policy thus creating tax-free income / distributions.
- Plans are non-ERISA.
- Benefits programs can be offered selectively to include only designated employees.
- Plans can be used as an optional or supplemental program alongside an existing program such as a 401(k), or other benefit plan.
- Under Internal Revenue Code 162, related employer expenses are 100% deductible in the year expenses are incurred.
- Program has a minimum guaranteed 0% base or floor (contributed savings portion is 100% protected from any loss and annual returns credited to account cannot go below 0%).
- Account values are annually locked-in.
- No IRS 10% early withdrawal penalty.
- First-day permanent / universal life insurance coverage for insured individual includes living benefits (i.e. coverage for chronic, critical or terminal illnesses) as well as death benefit coverage.
- Benefits are paid to policyholder’s beneficiaries—tax-free.