I cashed out a life insurance policy. My check stub says the entire amount is taxable. Two ins. agents told me only the interest is taxable. Which will be on my 1099-R?

Normally, life insurance proceeds you receive as a beneficiary due to the death of the insured person, aren't includable in gross income and you don't have to report them.

Nevertheless, any interest you receive on the proceeds is taxable and should be reported. If a policy was passed on to you for cash or other consideration, the exclusion for the proceeds is limited to the sum of the consideration you paid, additional premiums you paid, and certain other amounts.

There are some exceptions to this rule. Please see the following for additional information: IRS: Are Life Insurance Proceeds Taxable

Are you the beneficiary of the policy? If so, Life insurance proceeds aren’t taxable. If you’re the beneficiary of a life insurance policy, the IRS says you don’t have to report the amount received as income when you file taxes.

• Generally, life insurance proceeds you receive as a beneficiary due to the death of the insured person, aren't includable in gross income and you don't have to report them.
• However, any interest you receive is taxable and you should report it as interest received. See Topic 403 for more information about interest.
• If the policy was transferred to you for cash or other valuable consideration, the exclusion for the proceeds is limited to the sum of the consideration you paid, additional premiums you paid, and certain other amounts. There are some exceptions to this rule. Generally, you report the taxable amount based on the type of income document you receive, such as a Form 1099-INT or Form 1099-R. For additional information, see Publication 525, Taxable and Nontaxable Income.

See: https://www.irs.gov/faqs/interest-dividends-other-types-of-income/life-insurance-disability-insurance-proceeds