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Audrey Said:

Can Life Insurance refuse payment after the 2 years suicide clause expires? Contrary to public belief, I've f?

We Answered:

The two year exemption is there to prevent someone from taking insurance with the intent of killing themselves. You would be hard pressed to find someone who planned to kill themselves more than two years down the road. So, unless the company is able to find proof that the policyholder did this, which they would be unlikely to even look for, they would not be able to refuse payment.

Theresa Said:

If someone commits suicide do the family get life insurance payment?

We Answered:

Most policies have a suicide clause which states that no benefits are payable other than a return of the amount of premium paid if the insured commits suicide within 2 years from the inception of the policy.

The reasoning behind this is that if someone decides to commit suicide they are not about to go out and buy a life insurance policy and then wait two years just so a benficiary can get the insurance proceeds.

If the policy is more than two years old then the insurance company will pay.

Derek Said:

Do we pay tax on a Life Insurance insurance payment received as my wife has a critical illness?

We Answered:

I'm sorry to hear about your wife's illness. To get an answer that pertains to you with a defensible opinion, talk to a tax professional.

Generally, as long as she passes within two years of the payment, this is not taxable. If her death comes slower, it usually is. Please contact a tax professional to have them review your situation and give an opinion you can take to the IRS.

Yes, it's sad they would tax you for living too long, but ain't that the government?

Jesse Said:

Is there anyway I can write off my life insurance payment on my taxes?

We Answered:

Not for a sole proprietorship, which apparently you are. It's true that proceeds of life insurance usually are not subject to income tax, there are situations in which the proceeds would be. It's called the "transfer for value" rule and provides that if the policy has become a capital asset by someone purchasing the policy from another, then the proceeds are subject to income tax to the extent the proceeds exceed the premiums paid.

Ida Said:

Can you count medical expenses paid with a credit card on your taxes? Also life insurance payment?

We Answered:

Any unreimbursed medical expenses are tax deductible up to a certain limit. I'm not sure what is the exact number is, probably around 7%.

As for life insurance premiums, they are not tax deductible.