Xử lý thuếCâu 707 / 716
The main tax disadvantage of a Modified Endowment Contract (MEC) is that:
a.The premiums the owner pays into the contract suddenly become fully tax-deductible on the owner's personal income tax return
b.The death benefit becomes taxable
c.Living distributions such as loans and withdrawals are taxed on a LIFO basis, with a possible 10% penalty before age 59 1/2
d.It can no longer pay policy dividends
Giải thích
A MEC loses favorable living-benefit treatment: loans and withdrawals are taxed earnings-first (LIFO) and may carry a 10% penalty before 59 1/2. The death benefit itself remains income-tax-free.
Luyện miễn phí toàn bộ 716 câu hỏi — không cần đăng ký.
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Câu hỏi liên quan cùng chủ đề
- Accelerated death benefits paid to an insured who has been certified as terminally ill are generally:
- A Section 1035 exchange permits a tax-free transfer between:
- Which 1035 exchange is NOT permitted on a tax-free basis?
- The general rule that life insurance death proceeds are income-tax-free can be lost under the 'transfer-for-value' rule when the policy is:
- When death proceeds are left with the insurer and paid to the beneficiary in installments, the portion that is taxable is the:
- Premiums paid for personal life insurance are:
Cập nhật gần nhất: · quy trình kiểm tra
Đội ngũ PrepPass · Đối chiếu với California Life & Health Insurance License Exam · Quy trình kiểm tra
Người kiểm duyệt John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — kiểm tra)