In general, up to $50,000 (death benefit) of group term life insurance may be provided to employees tax-free (both federal income tax and FICA tax) under a cafeteria plan while still providing nontaxable life insurance proceeds upon the death of the insured employee. The cost of this coverage may be paid by the employer, the employee, or a combination of both. However, the employer must include in an employee's taxable income the cost of any employer paid group term life insurance coverage in excess of $50,000, based on the IRS Table I premiums.