Life insurance proceeds in Oklahoma are usually not taxable for income tax if the beneficiary is other than the estate. If the life insurance goes to the estate, either because the beneficiary was designated as such or the beneficiaries named on the policy are no longer alive, the death benefit goes through probate and will be taxed.
Oklahoma has state estate taxes that exempt the surviving spouse, and exempt other heirs up to $3,000,000. Federal estate taxes exempt up to $5,250,000, which includes the value of the policy proceeds plus the rest of the estate.
Syndicated Financial Columnist, Host of the weekly talk show Steve Savant's Money, the Name of the Game, Scottsdale Arizona
Life insurance proceeds generally pass to the the beneficiaries of the policy tax free. There are exceptions for business scenarios where the proceeds are subject to the AMT and estates that are larger than the unified credit or resident state exemptions. Consult your tax attorney for specifics in your state.
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Oklahoma has state estate taxes that exempt the surviving spouse, and exempt other heirs up to $3,000,000. Federal estate taxes exempt up to $5,250,000, which includes the value of the policy proceeds plus the rest of the estate.