Are benefits received from BOE insurance tax free?

Benefits received from Business Overhead Expense (BOE) insurance are generally not tax-free because the premiums paid for this type of policy are usually tax-deductible as a business expense. Since the premiums were deducted, the benefits received, which are intended to cover ongoing business expenses during a policyholder's disability, are typically considered taxable income.

The tax treatment of these benefits aligns with the principle that if an expense is deducted when paid, the income related to that expense becomes taxable when received. Hence, the BOE insurance benefits fall under this taxation rule, making them taxable to the receiver in most cases.

Specific exceptions might exist, depending on jurisdictions or unique situations, but the standard approach is that these benefits are subject to taxation.