Question: Exercise 5-23 (Algorithmic) (LO. 2) Alfred owned a term life insurance policy at the time he was diagnosed as having a terminal illness. After paying

Exercise 5-23 (Algorithmic) (LO. 2)

Alfred owned a term life insurance policy at the time he was diagnosed as having a terminal illness. After paying $69,950 in premiums, he sold the policy to a company that is authorized by the state of South Carolina to purchase such policies. The company paid Alfred $489,650. When Alfred died 18 months later, the company collected the face amount of the policy, $587,580.

As a result of the sale of the policy, how much is Alfred required to include in his gross in?

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