All sorts of income can potentially be tax - free, including:
Auto rebates; child - support
payments; combat pay; damages in lawsuits for physical injury; disability
payments, if you paid the
premiums for the policy; dividends on a
life insurance policy, up to the total of
premiums paid; Education Savings Account withdrawals used for qualifying expenses; gifts; Health Savings Account withdrawals used for qualifying
payments; inheritances;
life insurance proceeds; municipal bond interest; policy officer survivor
payments; profits from the sale of a home, up to $ 250,000 if you're single or $ 500,000 if you're married; qualified Roth IRA and Roth 401 (k) withdrawals; scholarships and fellowship grants; Social Security benefits (between 15 percent and 100 percent are tax - free); veterans benefits; and workers» compensation.
Also, the great thing about
life insurance policies is that they are unilateral contracts, meaning that you can cancel the policy any time you like (similar to
auto insurance) or simply stop making the
premium payments.