Life insurance premiums are not deductible. Many companies have life insurance on key employees and officers. Kind of grim subject, but obviously if the key officers or shareholders get hit by a bus and dies, the company is going to have some rough times. The life insurance proceeds can certainly help. When the life insurance is owned by individuals, the premiums are not deductible on your tax return anywhere, and then accordingly the proceeds are not reportable on your tax return. The same theory applies to businesses. The officer life insurance premiums are not deductible so they are backed out as a “book expense not deductible”. Then the proceeds would be recorded as “book income not taxed”.
@LarrySeal
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