- Participant forfeits specified excess benefits.
- Company pays premiums into a survivorship life
insurance contract owned by an irrevocable trust.
- Participant contributes, via gifts in trust, part of
the annual premium equal to the economic benefit of the
- Participant pays gift tax
(and GST tax, if applicable) on the economic benefit
contributions. Tax may be avoided by using available
- Company recovers its premium
outlay before or at death. Split-dollar agreement
- Life insurance trust receives
death proceeds free of income and estate taxes.