If the employer provides all employees with group term life insurance equal to twice the employee's annual salary, an employee with a salary of $50,000 has no gross income from the life insurance protection provided by the employer.

Question

Quizplus · Accepted Answer

The IRS allows the first $50,000 of employer-provided group term life insurance to be excluded from gross income. Any coverage over $50,000 is considered taxable income. Therefore, if the insurance coverage is $100,000 (twice the salary), the excess $50,000 is taxable.

If the Employer Provides All Employees with Group Term Life