Hello,
Currently I have a noticeable Prudential Variable Life Insurance (acquired in 1987), that I have to pass. The contract funds is $ 11,073.27 with a loan debt of $ 3979.84 from a net cash value of $ 7093.43. There is no fee waiver according to the statement. When I contacted prudential rules on waiver of this policy, I have a verbal tongue lashing to why I needed to this policy, and it would be difficult for the tax implications. I would not, however, this policy but would like to know exactly how this money will be taxed and how much of the net cash value of $ 7093.27 I will be in effect at the end. I am 50 years old, a widower, no family and no longer feel the need for life insurance business. Thank you for all the information you can offer.
Charles
Answer
Dear Charles,
The throw I do not want you for a change. While it is good to get insurance is not enough to leave your heirs with the responsibility for payment of past issues, it is likely that this policy is not suitable for this purpose.
I would only suggest that a variable life policy, that is what it is, if you're not for something better.
To determine what the tax bite would you subtract the actual premiums received from the contract value. If the total premiums are greater than the contract value, you will owe no income tax on the surrender of the policy.
As I think you know, the contract value will change from day to day. Therefore, the net surrender value pays off, even after the loan from day to day. Regardless of the contract value is the day you surrender to your policy, minus the outstanding loan will determine how much you get.
The tax is not what you get, but on what the difference between premiums paid and the contract is required at the time of termination. For example: if you had to pay $ 400 per year for 21 years you have the policy that you subtract $ 8400 from the contract say that the value of $ 11,074, and taxed at $ 2674th If you had to pay $ 600 per year, your total premium would be $ 12.600, and your taxable gain would be zero. Thus, no taxes.
In the unlikely event that your policy face amount is so small that you have a trust agreement as amended, based on your age it would be a Federal premature penalty of 10% on profit more than premiums paid. Even if your premiums on the contract value, there will be no tax or penalty.
Willard R. Brumbaugh, LUTCF
CA License 0374776
(888) 792-2379
Currently I have a noticeable Prudential Variable Life Insurance (acquired in 1987), that I have to pass. The contract funds is $ 11,073.27 with a loan debt of $ 3979.84 from a net cash value of $ 7093.43. There is no fee waiver according to the statement. When I contacted prudential rules on waiver of this policy, I have a verbal tongue lashing to why I needed to this policy, and it would be difficult for the tax implications. I would not, however, this policy but would like to know exactly how this money will be taxed and how much of the net cash value of $ 7093.27 I will be in effect at the end. I am 50 years old, a widower, no family and no longer feel the need for life insurance business. Thank you for all the information you can offer.
Charles
Answer
Dear Charles,
The throw I do not want you for a change. While it is good to get insurance is not enough to leave your heirs with the responsibility for payment of past issues, it is likely that this policy is not suitable for this purpose.
I would only suggest that a variable life policy, that is what it is, if you're not for something better.
To determine what the tax bite would you subtract the actual premiums received from the contract value. If the total premiums are greater than the contract value, you will owe no income tax on the surrender of the policy.
As I think you know, the contract value will change from day to day. Therefore, the net surrender value pays off, even after the loan from day to day. Regardless of the contract value is the day you surrender to your policy, minus the outstanding loan will determine how much you get.
The tax is not what you get, but on what the difference between premiums paid and the contract is required at the time of termination. For example: if you had to pay $ 400 per year for 21 years you have the policy that you subtract $ 8400 from the contract say that the value of $ 11,074, and taxed at $ 2674th If you had to pay $ 600 per year, your total premium would be $ 12.600, and your taxable gain would be zero. Thus, no taxes.
In the unlikely event that your policy face amount is so small that you have a trust agreement as amended, based on your age it would be a Federal premature penalty of 10% on profit more than premiums paid. Even if your premiums on the contract value, there will be no tax or penalty.
Willard R. Brumbaugh, LUTCF
CA License 0374776
(888) 792-2379
