Under current tax rules, employers can offer up to $50,000 of group term life insurance to their employees. This is a win because:
✅ Tax deductible for the business
✅ Tax-free for the employees
Here’s how it works:
• You offer group term life coverage to your team
• The first $50K of coverage is excluded from the employee’s wages
• You deduct the cost of the premiums as a business expense
• Anything above $50K? That portion is taxable to the employee, but the first $50K is a freebie.
Why it matters:
• Helps attract and retain top talent
• Cheaper then a raise: for a $50K policy, you may only be looking at around $15 per employee per month. For a salaried employee that is the equivalent of a $0.09/hr raise, but feels like a lot more!
• Easy to set up through most payroll providers or benefits platforms
If you’re looking for a way to offer a low-cost, high-value benefit to your employees, group term life insurance may be a win for you.
