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Subject:  Can I deduct the Surrender Charge of Insurance? Date:  3/22/2005  1:12 AM
Author:  Beckenbour Number:  77867 of 133131

Hi, Guys!

I am in a hard situation. Last year, I just surrendered my variable life insurance account. Let us say, I have invested in this account for 6000 dollars, and after surrender charge, I cashed for 1000 dollars.

I definitely know that the 1000 dollars is tax-free becuase my premium was not tax-deductible. However, I wonder if I can report the loss of 5000 dollars as "Capital loss" and get a 3000 deduction this year. (Which is the limitation for capital loss deduction per year for couple)

Anyone has an idea about this?

Thank you very much!
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