Tax Facts

210 / Can gift tax be collected from the donee of a life insurance policy or proceeds?

Updated: October 02, 2024 at 01:55 PM
Yes. If the gift tax is not collected from the donor, the donee is liable for the tax. The government can collect the gift tax from the donee-beneficiary, and the latter’s liability is not limited to the policy’s cash value.1





1.     IRC § 6324(b); Commissioner v. Chase Manhattan Bank, 259 F.2d 231 (5th Cir. 1958).

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