Life Insurance

What Is Tax-Free* Income?

"You Earn it. We Protect it."

Tax-Free Income Options
Many Wonder...

What Is Tax-Free* Income?

Tax free income may sound impossible. However, there are several options available for retirees. Proper retirement strategies and tax planning can set you up for a much smaller tax bill. Roth IRAs and certain Roth 401 (k) savings accounts may be able to be withdrawn tax free. Believe it or not, even life insurance can be part of the answer to “What is tax free income?”

does life insurance count as income
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How Life Insurance
Can Create An Income

Most people know the basics of life insurance. You buy it to replace your income when you’re gone. Putting the right life insurance in place can ensure your loved ones are financially secure. But, what most people don’t realize is this: Life insurance can provide an income while you’re still alive. 

Indeed, life insurance can be part of your strategy. It can be available in times of emergency. In addition, it can be used for college for grandchildren, or for large purchases. Amazingly, using these funds for expenses allows you to keep your other retirement savings principal intact. Depending upon policy type, life insurance can provide so much more than just a death benefit.

There are several

Types of Life Insurance

Several types of life insurance policies exist. One, called term life insurance, pays out a death benefit if you pass away within the term of the policy. Another type is max funded cash value life insurance. Generally, this type of policy allows for more flexibility.

In addition to providing a death benefit, max funded cash value life insurance policies can build cash value. In fact, some of these type of policies allow you to take money from the cash value they’ve built. Because this value is technically just an overpayment of life insurance, you are able to withdraw it, tax-free*. Additionally, some policies allow you to borrow against your cash value. In this case, the money you receive is actually a loan. Therefore, you collect it tax-free* as well.

Question:

When Is Life insurance the Answer to "What Is Tax Free Income"?

Not everyone’s retirement situation will lend itself to using life insurance as additional income. In fact, there are a few situations in which this strategy works best. Life insurance may be a good answer to the question “what is tax free income?” when one or more of the following conditions exist:

  • You are already maxing contributions to your 401(k), IRA, or other retirement plan
  • Tax-deferred strategies appeal to you
  • You’re looking for an additional “just in case” income source
  • Protection of income is needed

is life insurance taxed as income

Know Your Tax-Free* Income Options

Messina’s Wealth Management team works hard to ensure our clients have all their bases covered. Life insurance is a critical component of this. Let us help you determine the best strategy for you. Contact us for a complimentary policy review. We will review your current strategy, and make recommendations. Your legacy deserves protection. We are dedicated to helping you do just that.

Call us for a no-obligation consultation!

What Is Tax-Free* Income for Your Heirs?

One of the biggest advantages of life insurance is that you get to leave a legacy. Since the money is an insurance policy, the tax laws are different. Your beneficiaries receive the money tax free*, in addition to avoiding probate. You work hard your whole life to protect loved ones. If you choose the right life insurance policy, it can help ensure that happens.

Yes! Schedule my
"What is Tax-Free* Income?" appointment today.

Initial appointments are no-cost and no-obligation.

We’re open for business despite this virus because no one should have financial concerns on top of health concerns. You can’t quarantine your retirement. We are here to help.

“You Earn It. We Protect It.”  We believe in Keeping Your Principal Protected*, Simplifying Your Strategy, and A Reasonable Rate of Return**

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Messina’s Wealth Management, LLC MS Lic #1503388

Messina’s Wealth Management, LLC
LA Lic #717402

Dominick Messina
LA Ins Lic# 222159 

Dominick Messina
MS Lic #7176300

  • 178 Main St., Ste. 103
    Biloxi, MS 39530
  • 3224 N Turnbull Dr., Ste. 100
    Metairie, LA 70002
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    Gretna, LA 70053
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    Houma, LA 70360
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    Diamondhead, MS 39525
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*Proceeds from an insurance policy are generally income-tax-free, and if properly structured, may also be free from estate tax. Income-tax-free distributions are achieved by withdrawing to the cost basis (premiums paid), then using policy loans. Loans and withdrawals may generate an income tax liability, reduce available cash value, and reduce the death benefit, or cause the policy to lapse. This assumes the policy qualifies as life insurance and is not a modified endowment contract. The Host and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any transaction. This content is not intended to serve as the basis for any investment or purchasing decisions, nor does it recommend or involve the purchase, holding, or sale of a security.  All figures herein are hypothetical and for illustrative purposes only to explain general concepts.  No figure is to be relied upon as being accurate nor a guarantee or projection and is meant only as a partial overview of some relevant features and benefits of general insurance products that may be in the marketplace, and whose availability will be dependent on the State of residence of the consumer, and their individual suitability for the product they are wanting to purchase. Where insurance products are mentioned, any and all guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company.

IMPORTANT CONSUMER INFORMATION
This site is for informational purposes only and is not intended to be a solicitation for or offering of any product or investment. The offer for sale of an insurance product may only be conducted in a state where the agent is licensed and the product is approved for sale. The providing of investment advice relating to securities may only be done by a properly licensed individual operating through a licensed affiliate entity, unless otherwise exempt. Comments about past performance are not to be construed as a guarantee or assurance of future performance. This website may contain concepts that have legal, accounting and tax implications. We do not provide specific legal or tax advice, nor promote, market or recommend any tax plan or arrangement. Consult a tax/legal professional for guidance with your individual situation. No representations are made as to the accuracy or completeness of the information contained herein or any information contained in any link provided herein, nor does a consumer visiting the website create an agent-client relationship.

By contacting Messina’s Wealth Management, LLC MS Lic #1503388 / Messina’s Wealth Management, LLC LA Lic #717402 / Dominick Messina LA Ins Lic# 222159 /Dominick Messina MS Lic #7176300 you may be offered information regarding the purchase of insurance products, including fixed index annuities and life.

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