Excess Accumulated Earnings Solutions for C Corporations

Accumulated Earnings Tax

  • When you look at your client’s balance sheet do you see their retained earnings growing?
  • Have you considered that excess retained earnings may represent a future tax problem to the business or to them?
  • Did you know that there is an accumulated earnings penalty tax of 20%?

Loss of a Key Person

  • Have you considered what might happen to your client’s business if a key person was no longer able to work or were to die prematurely?
  • The Loss of a Key Person can have a devastating impact on your clients, your business operations, your credit, your future expansion plans, your other key people and, ultimately, your profits.

Personal Insurance and Retirement Needs

  • How well protected is your client’s family against his/her premature death or disability? Could their retirement accumulation use some help?
  • There is one solution that may help you address all three concerns - permanent life insurance.
  • Is this concept right for your client?

The Ideal Client for the Retained Earnings Solution is: 

  • A “C Corporation” with excess retained earnings
  • A business that requires life insurance coverage on the owner or a key executive
  • An owner who may have a future need for personally owned life insurance