My wife's father died in 1997 and in early 2008 my wife received a $2075 life insurance distribution from Met Life. My wife has 5 siblings so the total life insurance distribution must have been around $12,450. I'm not sure why Met Life didn't make the distribution sooner after her father's death - it may be Met Life's fault or it may be that the estate didn't notify Met Life in a timely matter.
A couple of days ago my wife (and other siblings) received a 1099-Int from Met Life for $569 in interest received in 2008 which I'd guess is the interest accrued on the life insurance from the date of death until the date the distribution was made. I know the insurance distribution is not taxable but is this interest taxable?