Question

Greg died on July 1, 2019, and left Lea, his wife, a $45,000 life insurance policy which she elects to receive at $9,000 per year plus interest for 5 years. In the current year, Lea receives $9,500. How much should Lea include in her gross income?

Answer 1

Answer:

$0

Explanation:

Generally, if a policy such as a life insurance policy that is transferred to another person by gift, the benefit in terms of money that comes from the life insurance that is given by reason of death is usually excluded from the receiver's gross income. Therefore, Lea does not have to add anything to her own gross income.