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You are here: Home Course materials CPE course study guides Study Guide- Life Insurance Proceeds

Study Guide- Life Insurance Proceeds

The study guide is provided to guide you through the course material in a step by step format.

Course material is a PDF document.

Chapter 1 – Life Insurance Death Benefits

Assignment: Chapter 1 <<>> Review Questions Chapter #1: # 1-6

When you have completed this course, you should be able to:

  • Compare the customary income tax treatment given to life insurance policy death benefits with the income tax treatment given to such benefits under a life insurance policy transferred for a valuable consideration;
  • Calculate the taxable portion of life insurance death benefits under a policy included in a qualified plan;
  • Identify the tax treatment of death benefits received as periodic payments under a supplementary contract;
  • Define the terms “terminally-ill” and “chronically-ill” as used in the Health Insurance Portability and Accountability Act; and
  • Identify the income tax treatment of accelerated death benefits and viatical settlements.

Chapter 2 – Life Insurance Policy Living Proceeds

Assignment: Chapter 2 <<>> Review Questions Chapter #2: #1-6

When you have completed this chapter, you should be able to:

  • Recognize the customary income tax treatment given to life insurance policy withdrawals, loans and surrender proceeds;
  • Identify the changes to the tax treatment of life insurance policy living proceeds resulting from the policy being deemed a modified endowment contract;
  • Identify the types of life insurance exchanges that are tax-free under IRC §1035; and
  • Recognize the income tax treatment of life settlements.

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