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Please allow me to make some clearifications on the tax free withdrawal benefits of VUL.

As long as the policy stays in force, money can be taken out tax free under the following circumstances:

1. Direct withdrawal on your basis
2. Low interest loans on your gains and in some instances no interest depending on the policy. The policy I have is .5% after 10 years and 1.5% before 10 years.

If the policy is surrendered, that's when you have a problem with ordinary income taxes only. That's why these policies should be over funded, and substantial withdrawals show only be made with an inforce ledger in hand.

Alan McKnight, CFP
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