Michigan life insurance

[Bootskitty15]

I know that life insurance is not counted as income therefore is not subjected to IRS but when I get to the question on my state form it asks if I received a payout due to an life insurance policy do I have to report it I know that I'm not going to have to pay taxes on it but it's a little weird that they would ask that question is it going to be on my final tax return because I don't have that money anymore it's all been spent on debts 

[AmyC]

Life insurance as a beneficiary is not taxable. If you cashed in your own policy, then the portion above your premiums paid is taxable. See Life insurance & disability insurance proceeds.

If you have taxable income, it goes on the federal and state. Otherwise, it isn't reported.