1. Life insurance death benefits paid in a lump sum to a named beneficiary are generally:

Received income-tax-free by the beneficiary

Lump-sum life insurance death proceeds are generally not subject to federal income tax for the beneficiary.

2. The cash value growth inside a permanent life insurance policy generally accumulates:

Tax-deferred while it remains in the policy

Cash value generally grows tax-deferred while it stays inside the policy.

3. When an annuity is annuitized, the portion of each payment that represents earnings is:

Taxable as ordinary income

The earnings portion of each annuity payment is taxed as ordinary income, while the return of principal is not.

4. Premiums paid for a personally owned life insurance policy are generally:

Not deductible for federal income tax purposes

Premiums on personal life insurance are generally a personal expense and are not federally tax deductible.