Section 79 Permanent Plans
Aloha from Business Planning Group. We are a national Third Party Administrator (TPA) for tax-advantaged, Section 79 Permanent Insurance Plans. We assist companies in the creation of IRS compliant plans that provide employees with tax-advantaged contributions, tax-deferred growth, protection for their families and assets during their working years and finally, tax-free distribution upon retirement.
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About Section 79 Permanent Plans
Section 79 Plans are a part of the employee benefit section of the IRC and includes benefits that are offered to employees at virtually all companies. If you are offering group term life insurance to your employees, you are already participating in Section 79 plans. In the Section 79 “Permanent” plans, participating employees can make plan contributions as high as 75% of their annual W-2 earnings based on the Section 79 guidelines. This is a perfect plan for attracting, retaining and rewarding key executives and employees at your company. Here are some of the important features of this available benefit:
- Plan contributions are 100% deductible to the corporation as an employee benefit.
- Plan participants can partially fund their plans with pre-tax earnings (this reduces gross income and current income tax liabilities).
- Contributions will reduce participant’s income and also lower payroll taxes for both the participant and the sponsoring company.
- Plans grow on a tax-deferred basis during the working years.
- Unlike 401k plans, Section 79 Permanent Insurance plans allow for IRS penalty-free access to funds before age 59½.
- Permanent plans include a tax-free death benefit for surviving beneficiary(ies).
- Distribution may be made on a tax-free basis utilizing policy loan provision.