However, I still have no idea how to do the future death benefit.
It is not an asset of mine. It might be an asset of my wife (if I die
first).
The death benefit is not an asset of anybody (yet). And yes, it could
result in an asset in YOUR books. Sorry, but death is no excuse for not
payi
The yearly life insurance company statement only shows
Increase in cash value
Increase in death benefit
It is fully paid up, so no more premiums.
Since the cash value is a real asset that I can borrow, I am now thinking
the increase in cash value
should be done as Non-taxable income.
However,
An exception to the previous (one where you WOULD be able to separate
out the "cost of the insurance component").
Split dollar life insurance.
This is something an employer might include in the compensation package.
Especially as serves as an incentive for the employee to stay at least
until
Not just "whole life" but any "cash value" policy.
The point here is that such insurance contracts have both a pure
insurance component and an investment component and may have associated
"rights" which also can be thought of as having value (that might also
be true of term insurance, no cash
Fred,
You will need a statement from the insurance company which details what
component of the premium credited to your bank account when you pay it) is a
contribution/increase to the capital value of the asset which is the insurance
policy (debited to the account representing the policy and whic
Suggestions on how to record for whole life insurance:
Premiums paid
Increase in cash value
Future death benefit
I think some of that is like the Degas painting example in the Tutorial in
that the increase in cash value is an Unrealized Gain.
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