Life insurance proceeds paid to you because of the death of the insured person are not taxable unless the policy was turned over to you for a price. This is true even if the proceeds were paid under an accident or health insurance policy or an endowment contract (§101). However, interest income received as a result of life insurance proceeds may be taxable.
I received a death benefit from my parent’s life insurance policy. Are these insurance proceeds taxable to me?
Modified on: Sun, 5 Feb, 2017 at 7:36 PM
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