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Ajay pays insurance premium for his employees. Which of the following insurance premiums will not be treated deductible as compensation paid to an employee?
Ajay pays insurance premium for his employees. Which of the following insurance premiums will not be treated deductible as compensation paid to an employee?
I. Health insurance with benefits payable to an employee
II. Keyman life insurance with benefits payable to Ajay
Answer & Solution
Correct Answer:
Option
B
A keyman life insurance policy is a policy that a company purchases on a key executive's life. The company is the beneficiary of the plan and pays the insurance policy premiums. It is also known as "key man insurance", "key woman insurance" or "business life insurance."
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