It depends. In this instance, you should try to determine how much of the cash surrender is premium and how much is earnings from interest or dividends. Any earnings over and above the premiums paid is taxable income. The last 7 years of statements may be helpful but it is difficult to say. Keep in mind, any dividend that is reinvested as a premiums is taxable. Only the premiums paid out of your own pocket are non taxable.
Regardless, you would report this as other income on your return. here is how to report.
- Click Federal Taxes -> Wages & Income and scroll down to Less Common Income
- Go to the last selection, Miscellaneous Income and click Start
- Go to the last option, Other reportable income and click Start
- When it asks, "Any other reportable income?" say yes and then type in a description and the amount to report it on your tax return.
@GaryinOz2002
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