Data Corporation has four employees and provides group term life insurance coverage for all four employees. Coverage is nondiscriminatory and is as follows:

a. How much may Data Corporation deduct for group term life insurance premiums?
b. How much income must be reported by each employee?

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Employee Andy Bob Cindy Damitria Age Key Employee Coverage Actual Premiums 62 es $200,000 $4,000 52 40,000 700 yes no 80,000 600 no 40,000 300