Constructive Receipt
Definition - What does Constructive Receipt mean?
A constructive receipt is a receipt that lists a person's entire income for a given tax period. Income from life insurance policies can be included in constructive receipts.
Insuranceopedia explains Constructive Receipt
The government uses constructive receipts to help calculate a person's income and figure out how much income tax they owe.
The returns of investment vehicles from life insurance policies, such as annuities, can be taxed. Death benefits, however, are not usually considered taxable income. They can, therefore, often be kept off constructive receipts.
How Well Do You Know Your Life Insurance?
The more you know about life insurance, the better prepared you are to find the best coverage for you.
Whether you're just starting to look into life insurance coverage or you've carried a policy for years, there's always something to learn.
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