Tom Archer Urges High-Net-Worth Individuals to Purchase Life Insurance to Protect Their Financial Assets from Potential “Wealth Tax”

Following a year of COVID-19 relief packages, aggressive spending programs and reduced tax revenue due to COVID, the federal and state governments are facing growing deficits and mounting debt. In an effort to address these deficits, many lawmakers are resorting to “tax the rich” maneuvers, including wealth taxes. Tom Archer, Founder and Chief Executive Officer of The Archer Financial Group, is telling high-net-worth individuals that they should prepare for a flurry of proposed tax hikes and buy life insurance.

Currently, the U.S. government debt is more than $27.97 trillion, according to data supplied by TreasuryDirect.gov. In an effort to close this gap, members of Congress and the U.S. Senate recently introduced the Ultra-Millionaire Tax, or the “wealth tax,” which would impose a 2% surcharge on those with a net worth of more than $50 million. Anyone with a net worth of over $1 billion would be assessed an additional 1% surtax. In addition, the president is proposing a tax hike on those making more than $400,000 a year.

“Some people think a 1-2% increase isn’t much, but, when you’re talking about someone who is worth eight or nine figures, it adds up,” Mr. Archer says. “The Ultra-Millionaire Tax will have a serious impact on their assets, much of which may be invested in stocks, bonds and real estate and may not be liquid. It will hurt them more than they will realize.”

Mr. Archer says these proposed tax hikes are just the tip of the iceberg as the government seeks to make changes to the estate and gift tax exemptions, the step-up basis and the estate tax. “The estate tax exemption of $11.7 million for individuals may be reduced to as low as $3.5 million,” he says. “The exemption is scheduled to sunset in five years, but the government is looking to move the expiration date to the end of next year. Plus, the reduced exemption would be applied retroactively.”

The government is considering changing the step-up basis, in which the beneficiary can sell off an inherited asset for what it’s worth after the previous owner’s death without any tax implications. “If your relative bought a house for $100,000 and it is valued at $600,000, you can inherit the house for $600,000 after their death and not have to pay taxes on the home’s value,” Mr. Archer says. “The government wants to change that by taxing the appreciation of the asset; in this case, the inheritor would have to pay taxes on the $500,000 upon their relative’s death.”

Currently, the federal estate tax is at 40%, but the government is seeking to increase the tax rate significantly. Mr. Archer explains how life insurance acts as a form of wealth protection. “The life insurance policy creates cash liquidity needed at death to pay taxes,” he says. “Therefore, people don’t have to liquidate assets or have a fire sale to create the cash that is needed.”

Among those who are part of Mr. Archer’s clientele include private billionaires, professional athletes, entertainers and celebrities, many of whom reside in New York and California — two high-tax states. In fact, New York State is proposing increasing the state income tax on The Empire State’s top earners from 8.82% to 10.82%, citing a $15 billion budget hole. Meanwhile, some members of the New York State Senate are proposing progressive tax brackets in which those with incomes of more than $100 million a year would be taxed at 15%. California currently has the highest income tax rate at 13.3% for those earning more than $1 million annually.

“For those who are in New York and California, there is a possibility that they may face larger tax burdens if these new wealth taxes are passed into law,” Mr. Archer says. “If they do not have a wealth protection plan in place, such as a life insurance policy, they should meet with a financial advisor immediately who has experience in wealth management and asset protection.”

Mr. Archer holds the record for the largest life insurance policy ever sold. He sold over $2 billion in life insurance in 2020 and has been named the number one life insurance advisor for several carriers. For more information, visit www.thearcherfinancialgroup.com.

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Legendary Life Insurance Advisor Tom Archer Continues to Shatter Records, Placing Over $1 Billion of Life Insurance in 2020

Tom Archer, arguably the greatest Life Insurance agent ever, has climbed to new heights. Mr. Archer refuses to be complacent after already leading several major insurance carriers throughout his career. He also holds the record for the largest life insurance policy ever sold.

On January 4, 2021, Mr. Archer received a call from Penn Mutual Life Insurance Company announcing that he led the entire company in life insurance production. There was not a close second place as he did millions in life insurance premiums and several hundreds of millions in death benefit. Believe it or not, Mr. Archer, who is truly a humble person, was the number one life insurance advisor for several other carriers as well.

Michael Kane, the manager who recruited Mr. Archer’s business, said, “I have never seen anything comparable to the likes of Tommy Archer. He is truly one of a kind and the greatest life insurance agent that I have ever seen. I have never seen anyone look out for their clients the way Tommy does. He always does the right thing, and his genius and brilliance puts him on a totally different level than the rest.”

In a year with so much going on with the pandemic and a lot of uncertainty, Mr. Archer went to work for his clients to further insure their families’ futures. “It is all about protecting my clients,” he said. “It was a very difficult year for a lot of people, and we wanted to let them know that we are there for them.”

In the very challenging year of 2020, Mr. Archer sold over $1 billion of life insurance among several insurance carriers to help families pay estate taxes, to assist in partnership buy-outs, to help with equitable distribution and to simply create cash when it is most needed. He says his clients purchase these policies as a way to protect their wealth for future generations. Currently, the estate tax exemption is capped at around $23 million for married couples ($11.5 million for individuals) under the Tax Cuts and Jobs Act. However, the exemption is scheduled to expire by the end of 2025, when it would return to $5.6 million for individuals, $11.2 million for couples. The current administration may move up the expiration date as part of its plan to impose higher taxes on the wealthy.

Mr. Archer states that he focuses on putting his clients at ease in such uncertain times. “We have to be there for our clients and continue to help and educate them as to what is going on and what changes may be on the horizon,” he said.

Mr. Archer handles the wealthiest families in the country. His clients consist of billionaire families, as well as well-known celebrities and over 200 professional athletes. “I handle every case differently simply because no two cases are alike. Each client, business and family have their own unique set of facts and circumstances. Each of them has a different problem that needs to be solved. You can never group anyone together to take a cookie-cutter approach in this business. You have to dissect every case a piece at a time.”

He credits his success to hard work, determination, mental toughness and enjoyment of what he does. “After 35 years in the business, instead of retiring I want to continue to do great things for my clients and for the industry,” he said.

In addition, Mr. Archer is an avid baseball lover who said he loves three things in this world: “Those are my family, the Chicago White Sox and my business.”