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    Exam 5: Health: Tax Issues in Life Insurance
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    When a Life Insurance Policy Is Surrendered or Lapsed, Any
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When a Life Insurance Policy Is Surrendered or Lapsed, Any

Question 47

Question 47

Multiple Choice

When a life insurance policy is surrendered or lapsed, any gain in the policy's cash value will be __________.


A) Received tax free by the insured
B) Taxed as ordinary income
C) Taxed as a capital gain
D) Taxed at estate tax rates

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