Here is an IRS article about proceeds under life insurance:
https://www.irs.gov/faqs/interest-dividends-other-types-of-income/life-insurance-disability-insuranc...
This is another good one:
https://www.irs.gov/help/ita/are-the-life-insurance-proceeds-i-received-taxable
If you surrender your life insurance, the total of premiums you have paid into the policy is known as the cash basis. When you surrender the policy, the amount of the cash basis is considered a tax-free return of principal. The amount you receive over the cash basis will be taxed as regular income, at your top tax rate.
