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I received a check from a life insurance policy in Washington

state. How much do I...
I received a check from a life insurance policy in Washington state. How much do I need to set aside for tax purposes?
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11/1/2012
Tax.appeal.168
Tax.appeal.168, Tax Accountant
Category: Tax
Satisfied Customers: 4,028
Experience: 3+ decades of varied tax industry exp. Tax Biz owner
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Welcome, THANK YOU for using Just Answer. My goal is to help make your life...a little...LESS taxing.

Were the proceeds death benefits from a policy? If so, the following applies, and the proceeds are not taxable.

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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. However, interest income received as a result of life insurance proceeds may be taxable.

REFERENCE SOURCE:

http://www.irs.gov/publications/p525/ar02.html#en_US_2011_publink1000229373

Please let me know if I can be of further assistance to you regarding this matter.

Thank you again for using JUST ANSWER.

Tax.appeal.168
Tax.appeal.168, Tax Accountant
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