Page 86 - The Informed Fed--Hearn Wealth Management

CHAPTER NINE

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Tax free income. Those three words just make us feel warm and
fuzzy all over. Nothing like getting one over on the IRS! Tax free
income? Are you kidding me? Is there really a true tax-free income

available in this country? The answer is yes. In fact, besides some
specifically positioned municipal bonds, there are two tax free incomes

life insurance can provide tax free income. The proceeds to the
beneficiary(s) are totally 100% tax free! You may ask, what good does

is you can borrow against the
cash value in a life insurance policy and the income is tax free. We have
structured many life insurance policies to maximize the cash value, while

minimizing the death benefit, so as to provide tax free income in
retirement. We use life insurance to solve estate tax issues as well. But

Let us make one thing clear before we get deep into this discussion.
The Roth TSP Is NOT a Roth IRA. We will take some time to review
the Roth IRA so you can learn the distinct differences between the two.

The Roth IRA was established by the Taxpayer Relief Act of 1997
(Public Law 105-34) and named for its chief legislative sponsor, Senator

William Roth of Delaware. In contrast to a traditional IRA, contributions
to a Roth IRA are not tax-deductible. Withdrawals are generally tax-free,

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