Is Life Insurance Settlement Taxable Income? 
That is a great question ! One of the main reasons to purchase a life insurance policy is the tax free benefit that is received by your named beneficiaries . If you 've named beneficiaries on your policy , as a rule , the benefit will not be taxed . There can be tax issues if no beneficiary has been named -LRB- or they 've passed -RRB- and the payment goes into the deceased 's estate , especially if that estate is a sizeable one . Thanks for asking ! 