Should I withhold taxes when surrendering/cancelling my life insurance policy?

Whether or not you should withhold taxes when surrendering/canceling your life insurance policy depends on your specific situation. Generally, if you cancel a life insurance policy and receive a payment that is greater than the amount you paid in premiums, you may be subject to taxation on the excess amount as income. However, if you are surrendering/canceling a life insurance policy and receiving a payment that is less than the amount you paid in premiums, you may not owe taxes on the payment. It's important to note that surrendering/canceling a life insurance policy can have other financial implications, such as surrender charges or fees, loss of coverage, and potential tax penalties for early withdrawals if the policy was used as a savings vehicle. It's recommended that you consult with a financial advisor or tax professional before making any decisions regarding surrendering/canceling a life insurance policy and withholding taxes. They can provide guidance on the tax implications and help you determine the best course of action based on your individual circumstances.