Tag: taxes

Answer: In general, life insurance proceeds paid to you because of the death of the insured are not subject to federal income tax. To qualify for such favorable tax treatment, the life insurance contract must meet certain IRS requirements. However, proceeds may be taxable in limited cases. For instance,...

To determine your basis in an asset for purposes of calculating capital gain or loss upon the sale or other disposition of the property, you need to understand two terms–initial basis and adjusted basis. Often, your initial tax basis equals your cost–what you paid for the asset. For example,...