Life insurance policies that are cashed out (surrendered) aren't taxable up to the amount of the premiums and other contributions. Earnings on the policy above and beyond the amount invested are taxable.
Please read this TurboTax Help article for more information.
If there are earnings to be reported, this is how you enter them in TurboTax.
- In TurboTax, open your tax return
- Click on Federal in the left-hand column, then on Wages & Income
- Locate the section Investments and Savings and click on the arrow on the right
- Click Start next to Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B)
- Answer Yes to the question: Did you sell any investments?
- Answer No to the question: Did you receive a form 1099-B or brokerage statement?
- Select Other from the list of investments.
- Follow the TurboTax interview to enter your information.
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