[jedalton]

Originally Posted by retiredguy123

I don't think the second paragraph of your post is correct, in this case, regarding income tax. Here is what the IRS says about income tax on life insurance proceeds.

"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."

that's if you transfer, if your beneficiary is tax free