OLA 1406 T 1008 Offering a Valuable Corporate Benefit

2 This material was not intended or written to be used, and cannot be used, to avoid penalties imposed under the Internal Revenue Code. This material was written to support the promotion or marketing of the products, services, and/or concepts addressed in this material. Anyone to whom this material is promoted, marketed, or recommended should consult with and rely solely on their own independent advisors regarding their particular situation and the concepts presented here.

3  Company’s top executives play vital role in corporate operations  Challenge to find benefits to attract and retain qualified high-level employees  Company pays premiums on life insurance policy for executive’s use as generous charitable donation A Rewarding Way to Attract Key Personnel

4  Talented, experienced individuals who have reached a high level of professional and financial success  Generally not dependent on corporate bonuses to maintain quality of life  Often charitably inclined  Volunteer or serve on charitable boards to give back to organizations they believe in Typical Executive Profile

5  Company agrees to pay premiums on life insurance policies on lives of its executives  Executive advises company as to which charity will be applicant and beneficiary of policy  Company pays premiums directly to insurance company, or to charity which in turn pays premiums How the Executive Legacy Works

6  Donation of cash or other property for use of qualified organization  Made from detached generosity  Must be gift of donor’s entire interest in property What Is a Charitable Gift?

7  Organization operated for religious, charitable, educational, scientific, or literary purposes, or for prevention of cruelty to children or animals  Examples:  War veterans’ organization  Domestic fraternal society  Governmental or state political subdivision What Is a Qualified Charity?

8  Company may be entitled to charitable income tax deduction  10% C corporation contribution limit  Five-year carryover provisions  S corporation gifts corporate assets  Life insurance tax deductible only if charity is policy owner Tax-Deductible Benefits

9  Every state has laws regarding insurable interest on insured  Rules designed to protect individuals  Seek legal expert on state laws when considering Executive Legacy program Insurable Interest

10  Implements Executive Legacy program to recruit and retain top leadership  Giant Industries pays premiums on $1 million life insurance policies on lives of selected executives  Giant Industries’ Executive Legacy program selects executives’ alma maters to own and become beneficiaries of life insurance policies Example: Giant Industries

11  Life insurance policies do not provide any financial benefit to executives  Giant Industries receives corporate tax deduction for premium payments  Donation of death benefit ultimately helps meet universities’ funding needs Example: Giant Industries (Cont.)

12 A company can:  Provide motivating incentive to recruit and retain key corporate leaders  Help support the work of charitable organizations  Receive valuable corporate tax deduction Executive Legacy Benefits

13  Life insurance allows corporations flexibility in creating executive compensation packages  Companies face intense challenges to attract qualified, talented executives  Businesses must offer new and valuable incentives  Executive Legacy is a unique program that may give you the advantage you need to recruit top-quality leadership for your company’s upper-level management team Take Advantage Now!

14 Transamerica Life Insurance Company, Transamerica Financial Life Insurance Company (collectively “Transamerica”), and their representatives do not give tax or legal advice. This presentation is provided for informational purposes only, and should not be construed as tax or legal advice. Clients and other interested parties must consult with and rely solely upon their own independent advisors regarding their particular situations and the concepts presented here. Discussions of the various planning strategies and issues are based on our understanding of the applicable federal income, gift, and estate tax laws in effect at the time of publication. However, tax laws are subject to interpretation and change, and there is no guarantee that the relevant tax authorities will accept Transamerica’s interpretations. Additionally, this material does not consider the impact of applicable state laws upon clients and prospects. Although care is taken in preparing this material and presenting it accurately, Transamerica disclaims any express or implied warranty as to the accuracy of any material contained herein and any liability with respect to it. This information is current as of November Life insurance products are issued by Transamerica Life Insurance Company, Cedar Rapids, IA 52499, or Transamerica Financial Life Insurance Company, Purchase, NY All products may not be available in all jurisdictions. Transamerica Financial Life Insurance Company is authorized to conduct business in New York. Transamerica Life Insurance Company is authorized to conduct business in all other states.

OLA 1406 T 1008 Offering a Valuable Corporate Benefit