Page 49 - Wages, Salaries and Other Earnings

Group-term Life Insurance

This insurance is term life insurance Former Employer
protection (insurance for a fixed If your former employer provided more
period of time) that: than $50,000 of group-term life insurance
• Provides a general death coverage during the year, the amount
benefit, included in your income is reported as
• Is provided to a group of wages in box 1 of Form W-2. Also, it’s
employees, shown separately in box 12 with code C.
• Is provided under a policy Box 12 will also show the amount of
carried by the employer, and uncollected social security and Medicare
• Provides an amount of taxes on the excess coverage, with codes M
insurance to each employee and N. You must pay these taxes with your
based on a formula that income tax return. Include them on
prevents individual selection. Schedule 2 (Form 1040), line 8, and follow
the instructions there.

Permanent Benefits
If your group-term life insurance policy
includes permanent benefits, such as a
paid-up or cash surrender value, you Accidental Death Benefits
must include in your income, as wages, Insurance that provides
the cost of the permanent benefits accidental or other death
minus the amount you pay for them. benefits but doesn’t provide
Your employer should be able to tell general death benefits (travel
you the amount to include in your insurance, for example) isn’t
income. group-term life insurance.

47