Bill names his church as the beneficiary of his $300,000 life insurance policy. When Bill dies, who is responsible for the income taxes payable on the lump-sum proceeds received by the church?

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Bill names his church as the beneficiary of his $300,000 life insurance policy. When Bill dies, who is responsible for the income taxes payable on the lump-sum proceeds received by the church?

A) His estate is responsible.

B) His church is responsible.

C) No income tax is payable on the death proceeds.

D) His estate and the beneficiary share the tax liability equally.

Answer: C) No income tax is payable on the death proceeds.

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