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Do I need to pay for teen second life?

I just received a payment from my fathers life insurance as he passed last month, do i need to pay taxes on it?

  • Do i need to pay taxes on the amount? Is it considered income or a gift? ( in canada by the way)

  • Answer:

    Per Sun Life of Canada: Death Benefit The beneficiary receives the death benefit of a Canadian life insurance policy tax-free. There are a very limited number of exceptions to this general rule. Following are the two principal exceptions: 1. A ‘non-exempt’ policy would be subject to taxation on the growth in cash value in excess of the growth in adjusted cost basis (ACB) of the policy (‘accrued income’) from the last reporting date to the date of death. The remainder of the death benefit would be tax-free. (Very few policies issued in Canada are non-exempt) 2. A policy registered as a Retirement Savings Plan would be subject to taxation in the year of death on the greater of the sum of premiums paid or the cash value. Such policies are rarely issued in Canada.

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Hello, In most cases, life insurance is not taxable as income. Other taxes may apply (such as estate taxes depending on the size of your father's estate). Since every case is different, you should run this question by a local accountant or one that is familiar with local tax laws. I hope this helps. Philippe ww.mcdlife.com

There are no inheritance taxes in Canada. Life insurance payments made directly to you or our father's estate are not declared as income nor are any cash assests from bank accounts, cash, personal property, etc. belonging to the estate.

Hello. Sorry for your loss. As far as insurance payments being taxed you need to consult with an accountant or lawyer for correct information as to your specific situation. OK? Best of luck to you.

Generally, no, it's not taxable, as long as you were paid directly by the insurance company.

Not 100% sure about Canada. However, here in the US, life insurance proceeds are not taxable; which is why whole life policies are used by wealthy folks. Why pay up to 50% in estate tax on the transfer of cash when you can send it through life insurance and lose significantly less?

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