True/False
When Betty was diagnosed as having a terminal illness,she sold her life insurance policy to Insurance Purchase,Inc. ,a company that is licensed to invest in these types of contracts.Betty sold the policy for $32,000 and Insurance Purchase,Inc. ,became the beneficiary.She had paid total premiums of $19,000.Betty died 8 months after the sale.Insurance Purchase,Inc. ,collected $50,000 on the policy.The company had paid additional premiums of $4,000 on the policy.Insurance Purchase,Inc. ,is required to recognize income from the above transactions,but Betty is not required to include her gain in gross income.
Correct Answer:
Verified
Correct Answer:
Verified
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