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A client, age 4 5 , a thind - genention owner of a business. The business is worth $ 5 0 million. Upon the client's
A client, age a thindgenention owner of a business. The business is worth $ million. Upon the client's dealh. Le wants to continue the family tradition by passing it to his son and estimates a $ million tax liability for both federal and estate taxes at the time of transfor. Becaus lie company witt foltow the teonomic cycle of the stock market and can cheate major cash constrints in a recession, which poliey would you recommend to pay this estimated million tax libbility at death if he is going to use the cash flow of the business to land this polieydGroup of answer cholices
Nurlathe tite insturance polley:
Universalvariable life insurne policy:
Universal life insurance policy.
Term insurance policy.
A client, age is a successful doctor making approcimately $ a year. Over the past years he has focused en paying off student loans und building has practice that he runs as a sole practitioner. Hie has done litte regarding retirentent sisings end will tund the curnen year k to the maximum. He wants to retire at age and fund a life insurance with the excess cash fow to be use for both retirement and have the death benefit help pay for any estate tax at his passing. He wants the funding of the premium to stop when he retires at age Which of this following statenents is weormen?
Group of unwer choles
Me can fund whole lfe policy over tie yer period and not worry about life insurunce buing a modified endowment contract MEC
He can take out his premium taxfree to thelp cash nows in retirement while not creating taxable income:
If the client chodes to distrbute come of his premiun payments from the policy before the edy windrawalperaly will apply
Distributions trom the policy wil be wased on firstin firstout FPO accounting nules.
Lamar own a universallife insuranee polisy wil an Opision Bo death benerit. The policy has the followine characteristics:
Fase vitue $
Cash valie $
Pilaup Aiditions
PuidUp Adations Cash Valwet $
Litetinie Pimfums Palit:
Anmual Polly Dividends $
Oustiming Loan
Bused on this information, what is the cument surrender value of Lamar's universal life msurance policy? Group of unswar cholces
N $
B
C $
D $
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