Is there tax liability involved if I cash in my life insurance policy? How? 4 Answers as of June 05, 2015

I am thinking about cashing in my life insurance policy for the current cash value. What kind of taxes will I have to pay? At this point I think that I have paid more in premiums than the cash value.

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Ronald K. Nims LLC | Ronald K. Nims
If you've paid more in premiums than the cash value, there is no taxable income (because you'll have a loss on the policy).
Answer Applies to: Ohio
Replied: 6/5/2015
Irsfeld, Irsfeld & Younger LLP | Norman H. Green
If you've paid more in than you get out, no tax.
Answer Applies to: California
Replied: 6/4/2015
Kokish & Goldmanis, P.C.
Kokish & Goldmanis, P.C. | Bernard H. Greenberg
There may be. Before proceeding, visit with your CPA first.
Answer Applies to: Colorado
Replied: 6/4/2015
Polsinelli Shughart PC | William B. Prugh
There may be if the amount received exceeds your basis in the policy which includes the premiums you have paid. The insurance company can answer this question to be sure. They will issue a 1099 form in any event that will need to be reported on your tax return.
Answer Applies to: Missouri
Replied: 6/4/2015
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