Question

Joe and Maggie have life insurance through their employers equal to two times their annual salaries, joe, age 37, has an annual salary of $56,000 and Maggie, age 34, has an annual salary of $59,000. the annual cost of the group term insurance is $20 for each employee?

Table 1 Rates for Group Term Insurance:

5-year age bracket | Cost/$1,000 insurance for

1 month period

Under 25

$0.05

25 to 29

$0.06

30 to 34

$0.08

35 to 39

$0.09

40 to 44

$0.10

45 to 49

$0.15

50 to 54

$0.23

55 to 59

$0.43

60 to 64

$0.66

65 to 69

$1.27

70 and above

$2.06

What is the amount of tax-free coverage for each?

What is the taxable amount of coverage for each?

What is the Table 1 monthly cost of the taxable benefit for each?

What is the Table 1 annual cost of the taxable benefit for each?

What is the annual taxable amount of the benefit for each?

Chapter 44 Group Term Life Insurance Joe and Maggie have life insurance through their employers equal to two times their annual salaries. Joe, age 37, has an annual salary of $56,000 and Maggie, age 34, has an annual salary of $59.000. The annual cost of the group term insurance is $20 for each employee. Table 1 Rates for Group Term Insurance CO -year ago back What is the amount of tax-free coverage for each? What is the taxable amount of coverage for each? What is the Table 1 monthly cost of the taxable benefit for each? What is the Table 1 annual cost of the taxable benefit for each? What is the annual taxable amount of the benefit for each?

Answer 1

1.The tax free coverage for each employee is $50000

2.The taxable amount of coverage for each are

joe-56000*2=112000-50000=62000

maggie-59000*2=118000-50000=68000

3.joe-age-37

according to table1-cost is 0.09 per $1000

excess amount taxable is 112000-50000=62000

excess per $1000 is 62000/1000=62

monthly taxable=62*0.09=5.58$

maggie-age-34

according to table1-cost is 0.08 per $1000

excess amount taxable is 118000-50000=68000

excess per $1000 is 68000/1000=68

monthly taxable=68*0.08=5.44$

4.joe annual is $5.58*12=66.96

maggie annual is $5.44*12=65.28

5.annual taxable amount for

joe is 62000

maggie is 68000