Question: Can an Individual Retirement Account, or IRA, own a life insurance policy?
Answer: No, IRAs are not permitted to own or hold a life insurance policy. It is one of the few investments that are prohibited in an IRA.
Comment: It is important to be careful with ‘non-cash’ related investments inside an IRA. For example, some people own real estate in their IRAs, but it is important to be careful with real estate (and certain other assets as well) because it is easy to jeopardize the IRA itself and cause adverse tax consequences.
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