Cash Surrender of a Whole Life Insurance Policy - Taxable Amount

[lbones]

I have a client that cashed in a whole life policy and received a 1099R in the amount of $15,794.45.  The 1099 shows nothing in box 2a or box 5.  I am thinking that this is due to the policy originating with Met Life and then Met Life mailed a check to All State back 11 years ago in the amount of $8,513 representing a 1035 Exchange.  The cost basis was $7950.  Then All State converted the policy to Wilton Reassurance at some point.  When surrendered, Wilton shows a accumulated cash value of $6416.16 and mailed a check to the client in the amount of $15,794.45

Client has been paying $113.93 per month for at least 15 years.  Shouldn't this whole amount be tax free as the premiums paid are at least $25,074?  If my logic is correct do I just put that figure in box 5?

[BobKamman · Accepted solution]

Is Box 2b checked "taxable amount not determined" ?  Is Box 2a blank, or does it show a zero?  If they are telling you none of it is taxable, then I would agree with that.  

[lbones]

Thanks for taking the time Bob.  Box 2b taxable amount is not determined is not checked.  Only the total distribution box is checked.  Box 7 is coded 7D.  Box 2a is blank