I'm only going to talk about this:
I cashed in my life insurance
What you did with the funds is irrelevant. Most likely you paid your premiums on this policy with after tax dollars. (money you already paid taxes on.)The type of policy you're dealing with here is most likely what's referred to as a "whole life" policy. I very seriously doubt your cash-out value exceeds the total of all the premiums you paid in. So for most (I stress *MOST*) they don't have a taxable gain.
However, (yes, for every rule there is an exception and when it comes to taxes, chances are high the exception applies to you.) if your whole life policy included something such as interest or dividends that accumulate over the life of the policy, when you cash out the policy that interest or dividend earnings are taxable income. The taxable amount is reported to you usually on a 1099-R. But it can be reported on a 1099-INT, 1099-MISC or other type of tax reporting document. You need to contact the insurance company and find out what type of tax document if any, they will be sending you. If possible to found out the amount, or at least a rough amount, that will help you determine if you need to send the IRS (and your state if applicable) an estimated tax payment. If you send the IRS at least 20% of the taxable payout, you'll be fine come tax filing time.
