Taxable Life Insurance Dividends

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Subject Author Date Taxable Life Insurance Dividends William Brenner 05-17-2008  Re: Taxable Life Insurance Dividends William Brenner 05-18-2008  Re: Taxable Life Insurance Dividends Han 05-18-2008  Re: Taxable Life Insurance Dividends Bill 05-18-2008  Re: Taxable Life Insurance Dividends Elle 05-18-2008  Re: Taxable Life Insurance Dividends Bill Brown 05-19-2008  Re: Taxable Life Insurance Dividends Stuart Bronstein 05-21-2008  Re: Taxable Life Insurance Dividends Seth 05-21-2008
Posted by William Brenner on May 17, 2008, 9:12 pm Please log in for more thread options A letter from a major life insurance company begins with (their words) "Good news", and goes on to explain that a very old whole life policy has reached the point where the total dividends received have equaled all of the premiums paid. The "good news" continues with the explanation that the above means that $600+ of this year's $1100+ dividend will be taxable income. (The tax can be deferred by purchasing additional paid up insurance, which I choose to not do.) The question is: Is this Line 21 Other Income? If not, where is it entered on Form 1040? Thank you. Bill -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by William Brenner on May 18, 2008, 12:07 am Please log in for more thread options William Brenner wrote: > A letter from a major life insurance company begins with (their words) > "Good news", and goes on to explain that a very old whole life policy > has reached the point where the total dividends received have equaled > all of the premiums paid. > > The "good news" continues with the explanation that the above means that > $600+ of this year's $1100+ dividend will be taxable income. (The tax > can be deferred by purchasing additional paid up insurance, which I > choose to not do.) > > The question is: Is this Line 21 Other Income? If not, where is it > entered on Form 1040? > > Thank you. > > Bill > It just occurred to my tired brain that, as it is a DIVIDEND, Schedule B might be a another possibility. I suppose it would be too much to expect that it would be a "qualified" dividend. What say thee? -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Han on May 18, 2008, 8:43 am Please log in for more thread options > William Brenner wrote: >> A letter from a major life insurance company begins with (their >> words) "Good news", and goes on to explain that a very old whole life >> policy has reached the point where the total dividends received have >> equaled all of the premiums paid. >> >> The "good news" continues with the explanation that the above means >> that $600+ of this year's $1100+ dividend will be taxable income. >> (The tax can be deferred by purchasing additional paid up insurance, >> which I choose to not do.) >> >> The question is: Is this Line 21 Other Income? If not, where is it >> entered on Form 1040? >> >> Thank you. >> >> Bill >> > It just occurred to my tired brain that, as it is a DIVIDEND, Schedule > B might be a another possibility. I suppose it would be too much to > expect that it would be a "qualified" dividend. > > What say thee? > Wait or ask for a 1099? -- Best regards Han email address is invalid -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Bill on May 18, 2008, 12:15 pm Please log in for more thread options wbrenner@nospamplease.net (William Brenner) William Brenner wrote: >OP elided, for brevity >It just occurred to my tired brain that, as it is a >DIVIDEND, Schedule B might be a another >possibility. I suppose it would be too much to >expect that it would be a "qualified" dividend. >What say thee? I was just about to respond with that very same opinion, except I wasn't sure of the "qualified" issue -- and would suggest you either contact the company, or perhaps await the formal 1099-DIV, which will undoubtedly be coming. Bill -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Elle on May 18, 2008, 3:39 pm Please log in for more thread options > a very old whole life policy has reached the point where > the total dividends received have equaled all of the > premiums paid. snip > The question is: Is this Line 21 Other Income? If not, > where is it entered on Form 1040? Pub. 17 (2007), page 64 and the 1040 instructions for Line 21 say Line 21. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted tax on life insurance January 3, 2007, 10:49 pm Life insurance proceeds September 20, 2007, 4:48 pm life insurance ownership November 15, 2007, 3:01 pm Interest on Life Insurance January 22, 2009, 6:35 pm Re: Life insurance benefit/ gift January 5, 2007, 8:05 am question on life insurance payout November 14, 2008, 2:18 pm Life Insurance Premium Deduction for C-Corporation September 23, 2009, 3:25 pm Questions about auto-insurance dividends February 22, 2008, 10:22 am Tax Free Interest and Dividends Taxed Due to Calculation of Taxable Amount of SS Benefits January 12, 2007, 3:06 am Life Tenency June 29, 2006, 12:35 am