Where do I enter inheritance (life insurance proceeds)?

[KenH1]

Life insurance death benefits are not taxable and thus not reported.

[tlstar_00]

The state of Calif. withheld money for federal taxes. How do I get that back?

[wabekem]

But the interest received on the policy since time of death to payment is taxable, correct?  We received a 1099-INT so it appears we will pay tax on that amount.