Hi, this is Maureen. Stay tuned for another insurance tidbit. Business owners often wonder whether or not life insurance can be claimed as a business expense on their taxes and the short answer is no because life insurance already benefits from a tax advantage status. It cannot be claimed as a business expense. However, there are a few instances in which it is possible to write off life insurance premiums as the business expense. If the life insurance policy is taken out on a key person in the business such as an owner or a partner, the premiums can be deducted. This is because the death of a key person in the business would have a negative impact on the company’s finances. Another instance in which life insurance premiums can be written off is if the policy is used as collateral for a business loan. In this case, the interest paid on the loan can be deducted as a business expense. This can be a helpful way to reduce the cost of borrowing money for your business and this can get tricky. So we always recommend consulting your insurance agent before making any final decisions.

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