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Question: Are accelerated insurance benefits taxable?

I recently received an accelerated benefit due to cancer from a life insurance policy and wanted to know if it is taxed.

Answer: Insurance benefits should not be taxed. It is the benefit you are buying from the insurer based on the contract policy when the insurer sells you an insurance. It is seller insurer therefore who will be taxed the moment you buy or paid the contract policy. In business including insurance business, it is the seller that is being taxed not the buyer.

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Taxation of corporate-owned life insurance policy proceeds payable to shareholders.: An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA's on August 1, 1992. The length of the article is 1390 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.From the supplier: C...

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Mary Holm: Bank bashing proves too hasty

I have had a considerable sum of money on term deposit in Westpac. The term ended on a Saturday but none of the money reached my bank account until Tuesday. All my money, principal and interest, "disappeared" for three days.Where...

The role of life insurance in your estate and financial planning, Part 2 of 3

Question: Taxable gains on life insurance?

A divorce case has prompted the surrender of a Universal Life policy so the proceeds can be split. There will be a gain on the policy, so that amount is taxable.

Who gets a 1099-R for the gains? Both of them, or just the owner?
He is the owner of the policy. I figured since he was splitting the proceeds in half with his wife, but they are no longer married, she might be responsible for the taxes on her half. He gets stuck with all of the taxes?

Answer: Owner of the policy will get the 1099-R and be responsible for the taxes.

Hopefully the divorce should address the taxes on the proceeds since it addressed splitting of the proceeds. If not then he needs to pay it or take her back to court.

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Taxation of corporate-owned life insurance policy proceeds payable to shareholders.: An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA's on August 1, 1992. The length of the article is 1390 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.From the supplier: C...

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Start preparing now to cope with estate taxes

Throughout your life, you strive to provide financial security for your family. Your efforts can extend beyond your lifetime if you work to control estate taxes.

Question: Minnesota residents-?

Are life insurance proceeds that are paid to a beneficiary taxable under the Minnesota State tax.
Does it follow the same guidelines as federal.
Please cite your source and possibly a link with info that I can print out.
Thank you!!

Answer: MN income starts with federal taxable income. Unless there is a specific provision in MN law, income that is not taxable on the federal return is not taxable to MN.

Additions to federal taxable income are listed in the instructions for line 3, Form M1 and in the instructions for Schedule M-1M. These instructions contain no addition for life insurance proceeds.

The law is contained in subdivision 19 (in particular subdivision 19a of section 290.01 of the MN law. You can see this at

http://www.helplinelaw.com/usa-statutes/minnesota/VARIOUS%20STATE%20TAXES,%20ADMINISTRATION/Income%20and%20franchise%20taxes

You can cut and paste this section. There is no addition for life insurance proceeds.

Income the key to claiming super deduction

With the end of the tax year looming, some people with large capital gains are looking for ways to decrease their tax.

Question: What items are taxable when mailing to brazil?

Had a package sent to Brazil (private) and the taxes were so high it needed to be returned. It had many items in it, and I am not sure what was "taxable". Is there a list of items which are taxable if sending mail from US to Brazil?

Answer: I think you'd get a better answer if you asked this question in Taxes - Brazil instead of Taxes - Other Taxes

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Intangible drilling cost preference exception not available when AMTI is negative. (alternative minimum taxable income): An article from: The Tax Adviser $9.95 ...

Juris lawsuit nets $26k

Former Gilford Police Chief and Town Administrator Evans Juris received $37,166.66 to end his claim against the town for alleged wrongful termination.

ASWN #2538 THE WEALTH OF NATIONS

Question: Social security disability benefits taxable? If you work how much can you earn before you have to file a retur

Answer: yes they are taxable but you don't usually get enough that you would have to owe any taxes

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How to handle a tax collector

Dear Tax Talk, If I understand correctly, I don't have to pay taxes on disability payments to me as long as it is under $25,000 per year. I have been contacted by an individual in Fresno, Calif., who was calling me about paying taxes on a previous year's "income" from Social Security disability . Once the amount of my benefits for that year has been clarified, Mr. Berg will contact me to get the ...

Toxic Losses