How to report income (survival benefit on policy maturity) from foreign (India) insurance policy ?

[ToddL · Accepted solution]

There is no U.S. tax on the return of premiums you paid for an insurance policy.

If any part of the payment was for interest, that income is taxable.

Enter it in the "Interest on 1099-INT" interview of Federal Tax > Wages and Income > Interest & Dividends. 

(If paid in Rupees, see: Currency Conversion - any reasonable method is acceptable).

[kvinay76]

Thanks for your response. As there is no clear 1099 INT. The interest need to calculated as Int = (Survival Benefit payout  - Sum of Premiums). However due to fluctuating exchange rates the Interest is negative. So is there is need to report this as a loss ?

[kvinay76]

In other words payout is > that than sum of premiums in INR. But when coverted to USD payout is < than sum of premiums.

[ToddL]

I see. In that case, there is no need to report interest income.