Potential Tax Liability for Life Insurance Plans
11-19-2009
Federal law requires that the cost of employer-provided group term life insurance in excess of $50,000 be reported as taxable income. This means that participants in the PCA insurance plans may have a tax liability for group term life coverage in the Basic Life, Standard Life, and / or the Optional Life Insurance Plans. Although the tax liability will probably be minimal, it does need to be added to the employee's W2 form as taxable compensation for 2009.
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