The following Life Settlement Tax info is provided as general overview for informational purposes only. Please understand that LifeSettlementTax.com does not provide tax advice.
For example, the taxation on a life settlement on a $1,000,000 policy with $50,000 paid premiums, $60,000 CSV and $200,000 life settlement value might be:
1. No tax due on $50,000 (return of premiums).
2. Ordinary income tax due on $10,000 (Cash Value minus premiums paid).
3. Long-term capital gains tax due on $140,000 (payment received above of CSV).
Call 1-888-973-8377 to speak with a Life Settlement Professional. Receipt of a cash settlement under a Life Settlement may affect your eligibility for public assistance programs, such as medical assistance (Medicaid), aid to families with dependent children, supplementary social security income and AIDS drug assistance programs. Such payments may also be taxable and subject to claims of your creditors. Before applying for a Life Settlement, you should consult with the appropriate social services agency concerning how receipt could affect your eligibility and that of your spouse or dependents. Due to the potential tax consequences, please consult with a professional tax advisor.