Ethos Index Universal Life Insurance (IUL)
Compare financial alternatives
While more than one option may be right for you, take a look at how Ethos IUL compares to some common financial alternatives:
Tax-advantaged retirement accounts 4 Taxable investments Qualified plans Roth IRAs IRAs Variable annuities CDs (FDIC insured)
Ethos IUL
Mutual funds 6
Bonds
5
No annual contribution limits 8
✔ 9
✔ ✔ ✔ ✔
Tax-advantaged growth
✔ ✔
✔ ✔
Tax-deductible contributions 7
✔
✔
Tax-advantaged 3 distributions
✔
✔
Fast, easy loans & withdrawals, generally tax- free 3 Access to tax-free funds 2 for qualifying health conditions
✔
✔
Tax-free death benefit 1
✔
Income tax treatment includes the treatment of capital gains and dividends. This chart excludes estate tax treatment.
Once, twice, three times tax-advantaged Ethos IUL offers several important tax benefits: • A death benefit for your loved ones that’s generally tax-free 1 . • Tax-advantaged 3 cash value growth that’s tied to popular indexes. Performance potential can be competitive with taxable financial alternatives. • Access to your cash value via policy loans and withdrawals, which are generally tax-free 1 .
1 In general, life insurance death benefits are free from federal income taxes pursuant to the IRS (IRC § 101(a)(1)). In certain situations, however, life insurance death benefits may be partially or wholly taxable. Potential examples include the sale of a life insurance policy, overfunding a policy, or employer- owned policies. Consult your tax advisor for full details. 2 Using the Care4Life Accelerated Death Benefit, policyholders may access a percentage of their tax-free death benefit early for qualifying critical, chronic and terminal health conditions. See page 6 for details. Care4life rider is not a long term care product. 3 Cash value growth is not subject to capital gains and access is tax-free assuming the following: 1) that withdrawals do not exceed tax basis (generally, premiums paid less prior withdrawals) and 2) that the policy is not a modified endowment contract. See IRC §§ 7702(f)(7)(B), 7702A. Cash value is typically accessed tax-free up to the tax basis via withdrawals, then accessed via loans, which are taxed as ordinary income but are not subject to capital gains. If the life insurance policy lapses, loans and withdrawals that exceed the total premiums paid will become taxable. 4 If you are covered by a qualified retirement plan at work, traditional IRA contributions are fully deductible only if your adjusted gross income falls within the following 2023 limits: single up to $73,000; married filing jointly up to $116,000. July 2023. Source IRS.gov. A distribution from a Roth IRA is generally income tax free if (a) it meets all the requirements for a qualified distribution (which include a 5 year waiting period and one of several additional requirements, one being that the distribution is made to a beneficiary on or after the death of the individual) or (b) it is a nonqualified distribution to the extent of after-tax contributions (basis). See IRC Sec. 408A. 5 Generally interest paid on municipal bonds is tax-free, but not all municipal bonds are exempt from federal and/or state income tax. Some bonds may be subject to capital gains tax at sale. Consult a tax advisor for more information. 6 Mutual funds may be subject to income tax and /or capital gains tax. Consult your tax advisor fore more information. 7 For life insurance, contributions refers to life insurance premiums. 8 Source: https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits 9 There is not a specific limit on the dollars allocated to purchase life insurance; however, there are maximum premium limits determined by the policy's specified amount. A policy will qualify as life insurance if it meets the requirements of IRC Sec. 7702, which includes limits on the amount of premium that may be paid into a specific policy and still qualify as life insurance.
6 of 9
Made with FlippingBook - professional solution for displaying marketing and sales documents online