Which of the Following Statements Is (Are)true Regarding Taxation of Life

question 12

Multiple Choice

Which of the following statements is (are) true regarding taxation of life insurance?
I.Life insurance proceeds paid in a lump-sum to a designated beneficiary are received free of federal income taxes.
II.The policyowner must pay taxes annually on the amount by which the cash value of his or her life insurance policy has increased.

• A)I only
• B)II only
• C)both I and II
• D)neither I nor II

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Definitions:

Leader-Member Exchanges

The interactions and relationships between leaders and their team members, which can affect performance and satisfaction.

Transformational Effect

A significant change or impact that drastically alters the existing condition, perception, or reality of a situation or entity.

Transactional Effect

The outcomes that result from a series of transactions or interactions, often referring to the consequences of specific actions within an organizational framework.

Sequencing Influence Tactics

The strategic order in which influence tactics are applied to maximize effectiveness.