Tax day is approaching! Hopefully, you’ve got your taxes filed and out of the way already, but we know there are plenty of procrastinators out there. Luckily for you, the deadline is April 18 this year, so you’ve got a few extra days to play with.
If you’re trying to take advantage of every credit or deduction you can, you might find yourself wondering about the various insurance policies you hold and how the premiums and/or benefits affect your taxes. While there are no black and white answers and every case is different, here is a simple article that provides some nice rules of thumb: How Does Insurance Affect Your Taxes?
By all means, any questions regarding your specific situation should be directed toward a tax professional. Generally speaking, though, the short answer is if your insurance policy is personal in nature – whether it’s your daily auto, your homeowner’s or even your life insurance – the premiums are not tax deductible. At the same time, any payments you receive as part of a settled claim, or – heaven forbid – that a beneficiary receives as the result of your death, are not taxable.
This can all vary if your policies are related to a business, so again, consult your tax professional. Happy filing!