Definition of "Section 79 plan"

Kim Heinz real estate agent

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Group whole life insurance policy designed to reduce an employee's exposure to income tax on the value of life insurance provided by the employer. The policy separates the term element from the cash value element, and apportions part of the premium to each. The plan takes advantage of the tax exemption to employees on a specified amount of group term insurance plans and the special tax rate on the premium for the amount of insurance over that amount.

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