Q: Hello,I'm new to this forum and first time asking a question. This is more of an accountant type question.
Hope you can help with these questions. My parent passed away a few years ago and had life insurance. After bills were paid and other expenses the rest was divided among the surviving children. I did receive a small share in the form of a check. I kept the check and have not cashed it.
The reason for not cashing it was depression among other personal reasons.
I didn't want to waste it on trivial stuff like fixing house I just wanted to use it for emergencies. Anyway, I also was behind on my taxes ($9,000) from being laid off a job of 30 years and went through bankruptcy. I am still unemployed today. Meanwhile I am still trying to negotiate for a decreased IRS tax dept.
My question is will cashing in the life insurance check have any affect with my trying to negotiate with IRS for a lesser taxes owed?
If I don't ever cash it in will they (IRS) ever find out that I have this check made out to me? Or do they already know? Maybe the life insurance company filed paper work?
A: This is a difficult question to answer without a lot more detail. But in general, you would need to list the check as an asset on your financial statement. If you spend the funds on necessary living expenses prior to setting up a payment alternative it might not be an issue. Filing a fraudulent financial statement is a crime. I would not post anything further on this in this forum. In my opinion you need the assistance of a tax attorney. Just stay away from the places you see advertised on tv.
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