If I receive a life insurance policy will I have to provide information to my tax person this coming year?

Question

My grandmother passed away and she left me some money which is a life insurance policy. Of course I didn't want the money all I wanted was my grandmother to be well and still be here with me! I didn't get to ask her a lot of questions about the policy but I knew about it b/c we had to talk about how she wanted her money in her bank account left for different people. I just wanted to know if when its time to do my taxes do I have to tell the lady that does my taxes that I received this policy? Its not a huge amount of money but I don't want to get in trouble if I don't let them know?! thanks for anyone who answers! I'm only 24 and I really don't know a lot about all of this stuff didn't think I would have to be dealing with my grandmas death at such a young age :*(

Answer 1

src50 is correct in this case life insurance proceeds are not taxable.

Answer 2

Life insurance proceeds are not taxable.

Answer 3

Normally the money gained by such a policy is tax free. It shouldnt bother you to ask your tax preparer.

I recieved 90k and didnt have to pay taxes, until id invested it and recieve capital gains from the investment..and never did on the pricipal.

Answer 4

You're describing two different things - if you are the beneficiary of the life insurance policy, then the money is not a taxable event.  If you are the beneficiary of the estate, then the ESTATE is subject to taxes, possibly.  

It's time to do taxes.

But either way, it's not YOUR taxable event.

Answer 5

Yes, anything that goes under your social security number goes under your taxes.