There are different kinds of life insurance policies. Is it just 401K policies that have PS 58 costs?

  1. 63333 POINTS
    Peggy Mace, Certified Senior Advisor (CSA)®PRO
    CEO, Outlook Life, Inc, Most of the U.S.
    PS 58 costs refer to the tax that is charged on the life insurance benefit provided by an employer. Therefore, the life insurance policies affected by these costs are group plans, split dollar plans, profit sharing plans that include life insurance, and other work related life insurance policies.
    Answered on January 23, 2014
  2. 1330 POINTS
    Mark TaylorPRO
    Licensed Life Agent, Life and Finance/ 50 States, New York
    PS 58 Costs are taxes in group policy that the employer pays. In a group policy or on the job an employer will open a policy on the employees in the event the employee has a death on the job. The employer owns the policy but unlike personal policies they are taxed monthly on the accumulation. The death is to only happen on the job and the beneficiaries are paid the benefits and many times the employer is paid for the loss of the employee depending on policy.
    Answered on January 23, 2014
  3. 37376 POINTS
    David G. Pipes, CLU®, RICP®PRO
    Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
    If you are being notified of PS 58 costs it is most likely that you are participating in a split dollar life insurance plan. The portion of the life insurance premium being paid by your employer that the IRS deems to be an economic benefit to you is roughly equivalent to the cost of one year term insurance. If you paid part of the premium the amount you paid is subtracted. .
    Answered on December 30, 2014
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