Surrendering a VUL

[insurancequestions]

Question - If my cash surrender value is less than or equal to what i have paid in premiums in total - - and I cash out and close the policy do I have to pay taxes on the surrendered value?

EXAMPLE
10 years of $100 a month premium = $12,000
existing loan on account = $1,0000
surrender value $11,000

cancel policy and get check for $11,000

Do I have to pay taxes on the $11,000 ???

 

[BNTRS]

No

Assuming you've never pulled other money out of the policy that you have no mentioned.

You have no taxable gain from this policy, under the scenario you've described.

 

[insurancequestions]

thank you for your quick reply