All life insurance proceeds given to the beneficiary at the time of death of the insured are excluded from gross income.

Question

Quizplus · Accepted Answer

Life insurance proceeds are generally not taxable as income for the beneficiary. However, if the proceeds are paid out in installments with interest, the interest portion may be taxable. Additionally, if the policy was transferred for valuable consideration, a portion of the proceeds may be taxable.

All Life Insurance Proceeds Given to the Beneficiary at the Time