I will be entitled to an amount of funds shortly, life insurance. I understand these funds will not be taxed. Unsure how to ask this properly so here it goes....
With whatever amount this life insurance is, how is the amount kept separate as to not be considered taxable by IRS?
Do I need to keep it separate from say, my checking or savings account, or other account?
I have a credit union where I intend to place these funds, that already has a balance of say 11k within, which is making .5% and is liquid. So if I were to place the money in on this account, how does the IRS keep this separate as so I do not get taxed on it? (say I add 100K which then makes the total 111K....confused as to how the IRS knows to keep life insurance separate from regular funds)
Sorry if I'm not wording this correctly, but hopefully you understand my question.
Drmax....Indiana
With whatever amount this life insurance is, how is the amount kept separate as to not be considered taxable by IRS?
Do I need to keep it separate from say, my checking or savings account, or other account?
I have a credit union where I intend to place these funds, that already has a balance of say 11k within, which is making .5% and is liquid. So if I were to place the money in on this account, how does the IRS keep this separate as so I do not get taxed on it? (say I add 100K which then makes the total 111K....confused as to how the IRS knows to keep life insurance separate from regular funds)
Sorry if I'm not wording this correctly, but hopefully you understand my question.
Drmax....Indiana