Corporate-Owned Life Insurance For CCPCs: Tax Rules

Many CCPC owners hear that “if the corporation owns the policy, the death benefit can come out tax-free through the CDA.” That’s often true … but there’s a lot more to it than meets the eye.

This post explains how corporate-owned life insurance works, what’s usually deductible, what happens on death, and what triggers tax when you access cash value during your lifetime.

In this in-depth blog post we cover:

• What “corporate-owned life insurance” means (owner, insured, beneficiary)

• Term vs permanent (cash value) policies: what’s different

• Are premiums deductible for a corporation?

• What happens on death: proceeds, policy ACB, and CDA credit

• What happens during your lifetime: withdrawals, surrenders, policy loans, collateral borrowing

• Common traps (shareholder benefits, beneficiary mistakes, CDA election errors)

• Practical checklist for CCPC owners

• …and more!

Let’s dive in!

Thank You For Reading. See You Next Time!

Think Team🙏