Life Insurance Deductibility

[Snaggletooth]

99% C Corp owner has a life insurance policy for $1,000,000. The C Corp at one time had a line of credit with the bank, and the bank required him to carry this policy with the corporation named as beneficiary. The policy is still in effect but the line of credit requirement is gone. When the line of credit was paid off, his age was such that keeping the policy was a prudent thing.

Premiums for this policy last year were $14,000. Can the corporation deduct this as an expense??

Please don't respond and insult me by asking if I have read the instructions. I already have, and the deductibility depends on so many factors I can't wade through them. If I could interpret code and regs on this subject I wouldn't be asking. If this qualifies me for a single-digit IQ, then so be it.

[TAXNJ]

99% C Corp owner has a life insurance policy for $1,000,000. The C Corp at one time had a line of credit with the bank, and the bank required him to carry this policy with the corporation named as beneficiary. The policy is still in effect but the line of credit requirement is gone. When the line of credit was paid off, his age was such that keeping the policy was a prudent thing.

Premiums for this policy last year were $14,000. Can the corporation deduct this as an expense??

Please don't respond and insult me by asking if I have read the instructions. I already have, and the deductibility depends on so many factors I can't wade through them. If I could interpret code and regs on this subject I wouldn't be asking. If this qualifies me for a single-digit IQ, then so be it.

No if corporation is beneficiary of the policy.

[Snaggletooth]

Great Response - Thank You

No if corporation is beneficiary of the policy.

Great response TAXNJ. Very specific and addresses the question unequivocably. Thank you.

[Burke]

Normally, when these policies are no longer required, the ownership is passed to the insured.