Tax Facts

59 / Are there any exceptions to the general rule that viatical settlements are not included as taxable income?

Updated: October 02, 2024 at 01:55 PM
There is one exception to this general rule of non-includability for viatical settlements. The rules outlined above do not apply to any amount paid to any taxpayer other than the insured if the taxpayer has an insurable interest in the life of the insured because the insured is a director, officer or employee of the taxpayer or if the insured is financially interested in any trade or business of the taxpayer.1





1.     IRC § 101(g)(5).

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