my wife passed away in 2004 i did not know she had life insurance designating me as benifitsiary. in 2012 i discovered this policy and contacted the insurance co. they had me fill out the appro. forms and paid me the money from the policy, they also paid me interest earned on the money. my question is do i owe federal and state income taxes on the interest from this policy? The policy was for $23000.00 and the interest paid to me was $7300.00.