Will A Beneficary That Receives Social Security, Have Their Income Affected If They Receive A Payment?
When a beneficiary receives a payment from a life insurance policy it will not compromise their Social Security benefits. A payment of a life insurance policy is not considered taxable income. Therefore, payments cannot be decreased because someone was the recipient of a life insurance payment.
As an additional note, people who receive a life insurance policy settlement do not have to claim the payment as income so the payment is also income tax free.