Earnings on variable life and universal life insurance policies are ________.

A) never taxed
B) taxed only at the capital gains tax rate
C) not taxed until the money is withdrawn
D) not taxed at the federal level but are taxed at the state level

Question

Brooke Pulliam · Accepted Answer

Final Answer : C, Explanation :  Earnings on variable life and universal life insurance policies are not taxed until the money is withdrawn. However, if the money is withdrawn before the policy owner is 59 and a half years old, there may be penalties and taxes on the earnings. Also, if the policy is surrendered or sold, there may be taxes on any gains or earnings.

Earnings on variable life and universal life insurance policies are ________.

A) never taxed
B) taxed only at the capital gains tax rate
C) not taxed until the money is withdrawn
D) not taxed at the federal level but are taxed at the state level

Definitions

Learning Objectives

Learning Objectives

Related questions

Earnings on variable life and universal life insurance policies are ________.A) never taxedB) taxed only at the capital gains tax rateC) not taxed until the money is withdrawnD) not taxed at the federal level but are taxed at the state level

Definitions

Learning Objectives

Learning Objectives

Related questions

Earnings on variable life and universal life insurance policies are ________.

A) never taxed
B) taxed only at the capital gains tax rate
C) not taxed until the money is withdrawn
D) not taxed at the federal level but are taxed at the state level