1. Under IRC Section 1035, which exchange can be made without recognizing gain?

A life insurance policy for an annuity contract

Section 1035(a) allows tax-free exchange of a life contract for another life contract, an endowment, an annuity, or a qualified long-term care contract; an annuity cannot be exchanged tax-free for life insurance.

2. Employer-paid premiums for an employee's group accident and health coverage are, for the employee:

Excluded from gross income

IRC Section 106(a) provides that gross income of an employee does not include employer-provided coverage under an accident or health plan.

3. Life insurance death benefits paid to a named beneficiary in a lump sum are generally:

Received income-tax-free

Lump-sum death benefits are generally received free of federal income tax by the beneficiary.

4. The growth of cash value inside a permanent life insurance policy is generally:

Tax-deferred while it remains in the policy

Cash value grows tax-deferred; a taxable gain may arise only if the policy is surrendered for more than its cost basis.