Comments on: Does My Beneficiary Have To Pay Taxes On My Life Insurance Policy When I Die?

By: Irishklh

Irishklh — Sun, 19 Sep 2010 21:20:50 +0000

I run a small business. We gross about $700,000 per year. I do my accounting on Quicken. At the end of the year I print off all the reports including a profit and loss statement. He is not a CPA. He is a general accountant. I get a bill for almost $2,000. I questioned him on it and he told me he charges $100 per hour. Does he really spend 20 hours doing this? The majority of the money goes out to about 8 or 9 independent contractors, so the huge majority is eaten up by 1099s. Does it really take 20 hours?

Thank you.

By: money-saving-tips

money-saving-tips — Sun, 25 Jan 2009 16:17:34 +0000

Yep…no income tax, but you do have to account for estate taxation. And yes, avoid the “investment” side of the policy. That’s a whole life policy instead of a plain term life policy, which mixes two different thoughts, and isn’t usually a good idea.

By: Senior Life Insurance

Senior Life Insurance — Thu, 25 Sep 2008 15:45:54 +0000

No income taxes to be paid on life insurance proceeds, although will be includable in estate for estate taxation purposes without some sort of legal structure in place like life insurance trust (ILIT). Hope this helps.

By: hank

hank — Mon, 10 Mar 2008 20:15:28 +0000

CriticalInsurance- maybe I’m reading it wrong, but it says in the quote there: “…he agreed with me that your beneficiary will NOT (99.999% of the time*) have to pay taxes on it.”

is that not what you’re looking for?

By: Critical Insurance

Critical Insurance — Mon, 10 Mar 2008 19:57:48 +0000

Really good question. But what’s the answer? Does my beneficiary have to pay?