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Wallstreet Esq.
Wallstreet Esq., Tax Attorney
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Experience:  10 years experience
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Is Life/Accident/Cancer insurance payroll deduction, is it –

Customer Question

for Jonathan Tierney" Is Life/Accident/Cancer insurance payroll deduction, is it – Pre Tax?
Submitted: 11 months ago.
Category: Tax
Expert:  Jonathan Tierney replied 11 months ago.

Life insurance would be an after tax deduction as life insurance proceeds (at death) are always tax-free. Disability policies, such as accident and cancer insurance can be pre-tax if there is an IRC 125 plan in place. See and the attached pamphlet. The link and pamphlet above are from companies that help employers' set up 125 plans though I am not familiar with either company. If there is no formal IRC 125 plan in place, then all the payroll deductions would be after-tax.

Customer: replied 11 months ago.

Gotcha. Yes, there is a IRC 125 in place.

Thank you. You are always on point.