Is Life Insurance Taxed In Michigan? 
It 's a fairly vague question so I would have to say that in the United States life insurance is not taxed in any state except under specific circumstances . If you own a life insurance policy and it has grown a cash value greater than the amount of premium you 've paid into it , and you then surrender the policy and take the cash value , you may be taxed on the amount of gains over what you paid in premiums . If you paid too much premiums into a cash value policy so that it becomes a modified endowment contract you will then be taxed on the gains that are earned . And there are a couple other instances where taxation may be incurred , but generally life insurance is not taxed . 