Bergenia crassifolia (L.) Fritsch--Pharmacology and phytochemistry by Shikov, Alexander N.; Pozharitskaya, Olga N.; Makarova, Marina N.; Makarov, Valery G.; Wagner, Hilde / Phytomedicine: International Journal of Phytotherapy & Phytopharmacology.
The insurance policy gets to grow tax free, so that when you die there is enough in the policy to pay the estate taxes. For example: You have a $20 million estate. When you die, this estate will pay $11 million in estate taxes, leaving your kids with a net of $9 million.Therefore, to fight this: You spend $5 million on life insurance. The life insurance grows tax-free from $5 million to $20 million.ow your estate is worth $35 million (your $20 million estate, less the $5 million premium, plus the $20 million payout). You now pay $19 million in estate taxes, which means that your kids net $16 million -- a full $7 million ahead of where you would have been if you hadn't bought any life insurance at all!
If you are working and paying into Social Security, some of the taxes you pay go toward survivors insurance. In fact, if you currently have life insurance, the value of your private policy is probably less than the value of the survivors insurance you have under Social Security. Your family is protected when you die. Your spouse and children could be eligible for benefits based on your earnings.