Tax Treatment of Life Insurance Proceeds
Credit Hours: 4
Field of Study: Taxes
Requires Prerequisites or Advanced Preparation: No
Delivery Method: Online PDF
Instructor: Paul Winn, CLU, ChFC
When you have completed this course, you should be able to:
- Calculate the gain to be recognized as a result of various life insurance policy transactions, including:
- payment of death benefits
- Identify the changes to the customary tax treatment of life insurance policy living proceeds resulting from the policy being deemed a modified endowment contract (MEC).
- Calculate the reportable gain upon receipt of life insurance policy death benefits when the life insurance policy:
- Has been transferred for a valuable consideration.
- Was included in a qualified plan.
- Recognize the types of life insurance exchanges that are tax-free under IRC §1035.
- Define the terms "terminally-ill" and "chronically-ill" as used in the Health Insurance Portability and Accountability Act.
- Identify the income tax treatment of accelerated death benefits, viatical settlements and life settlements.