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Life insurance proceeds are not taxable when they are paid out as a death benefit. Depending on the amount of the insurance policy the payout options should be either lump sum, annuitized, fixed monthly payments for a period of time, or left with the insurance company in an interest bearing account with check writing privileges.

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โˆ™ 2005-10-23 19:37:57
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Q: How is life insurance paid off in the case of a death and is it taxable?
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Related questions

In NC are life insurance death benefits taxable?

no


Is inherited life insurance taxible?

The death benefit for life insurance is not taxable assuming it is not a Modified Endowment Contract.


Is money inherited from a parent's life insurance policy taxable income?

Death benefits are not taxable for income tax purposes.


Are life insurance benefits taxable in MN?

The death benefit itself will not be considered taxable income. However, if your state requires that the life insurance company pay interest on the death benefit if the claim isn't processed in a certain period of time, then the amount of interest is considered taxable.


Are US life insurance policies taxable?

As a general rule, life insurance policies in the US are not taxable. However it is taxable if it is combined with a non-refund life annuity.


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Do you put life insurance payout on as income on tax papers?

Generally speaking, the death benefit payout of a life insurance policy is not taxable from a federal tax standpoint, and usually not taxable from most states. I suggest you check with your state insurance department.


Is life insurance taxable?

Life insurance proceeds paid to a beneficiary is not taxable. However, if the life insurance beneficiary is a trust or estate, there may be some tax implications.


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No but what you do with the money may be taxable.


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