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I add to what has already been said, I believe the premiums paid in over the life of the policy are the untaxed portion. Any cash value beyond that is taxed.

I cashed in a couple whole life policies in the 80's that had been in existence since the mid 50's. Nothing was taxable. However, since the policies were taken out when I was a child, 10 years or more had been at greatly reduced premiums. I had only paid the full premium for about 20 years.
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