VUL - Opportunity?

The Total cash value can grow substantially over time. Growth can be accelerated by delaying or deferring taxes on the gains until their distribution. If an overall gain is present, taxes become due at policy surrender or lapse and when certain distributions occur. There are no taxes on any growth at the time of death. Theodore H Cohen, 39 TC 1055 (1963) acq. 1964-1 CB4 also IRC Sec. 72 No taxes are due when cash value is taken through a policy loan. This permits use of any growth. If a loan is outstanding at the time of death, the amount of the policy death benefit will be reduced by the amount of the outstanding loan. The use of the death benefit to repay a loan is not a taxable income event. When the cash value is sufficient, it can be taken as tax-free withdrawals, subject to limits. IRC Sec. 7702A (b) Cash Values can be moved among subaccounts. Transfers from the fixed account are limited to one per year. Transfers among subaccounts, in excess of twelve per years, are subject to changes. All transfers are tax free. Depending upon the frequency of transfers, certain additional restrictions may apply. Because it is a VUL, the death benefit can generally pass to the beneficiary federal income tax free. IRC Sec. 101(a)(1) and IRC Reg 1.101-1

The net premium allocated to the investment option is managed by professional money managers. Investing entails varying levels of risk and reqard. The optimum balance within the risk-reqard spectrum varies by investor because of different goals, time horizons and tolerance for risk. Since the no-lapse guarantee does not depend on the investment performance, you have a great amont of flexibility in your investment choices. Over time, equities have provided long-term growth for disciplined and patient investors. Asset allocation, the process of dividing money among a variety of investment choices, and portfolio selection are two of the most important determinations for the overall performance of your assets. Asset allocation by means of a balanced, diversified investment strategy may control risk and offer the opportunity for long-term growth. Choose portfolios tailored to meet your investment goals, time horizon and risk tolerance from among these professional money managers. The available options cover the spectrum of investment objectives and allow you to tailor your investment goals.

Any question please contact our financial department 626-285-3860 Email: financial@la1sttax.com