« previous next »

Author Question: Juanita paid a life insurer 45,000 in exchange for an immediate life annuity. Juanita will receive ... (Read 188 times)

Metfan725

  • Hero Member
  • *****
  • Posts: 552
on: Jul 11, 2018
Juanita paid a life insurer 45,000 in exchange for an immediate life annuity. Juanita will receive 500 per month from the insurer, and her life expectancy is 15 years (180 months).
 
  Assume that Juanita receives 12 monthly payments of 500 the first year. How much taxable income must she report?
  A) 3,000
  B) 4,000
  C) 4,500
  D) 6,000

Question 2

Which of the following statements is (are) true regarding the taxation of distributions from individual annuities?
 
  I. Individual annuity distributions are never taxable.
  II. Once the annuitant has recovered the premiums he or she paid for the annuity, the entire annuity distribution is taxable.
  A) I only
  B) II only
  C) both I and II
  D) neither I nor II


olderstudent

  • Sr. Member
  • ****
  • Posts: 339
Reply #1 on: Jul 11, 2018
Answer to Question 1

Answer: A

Answer to Question 2

Answer: B


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Russia has the highest death rate from cardiovascular disease followed by the Ukraine, Romania, Hungary, and Poland.

Did you know?

Certain topical medications such as clotrimazole and betamethasone are not approved for use in children younger than 12 years of age. They must be used very cautiously, as directed by a doctor, to treat any child. Children have a much greater response to topical steroid medications.

Did you know?

Pregnant women usually experience a heightened sense of smell beginning late in the first trimester. Some experts call this the body's way of protecting a pregnant woman from foods that are unsafe for the fetus.

Did you know?

Although the Roman numeral for the number 4 has always been taught to have been "IV," according to historians, the ancient Romans probably used "IIII" most of the time. This is partially backed up by the fact that early grandfather clocks displayed IIII for the number 4 instead of IV. Early clockmakers apparently thought that the IIII balanced out the VIII (used for the number 8) on the clock face and that it just looked better.

Did you know?

Persons who overdose with cardiac glycosides have a better chance of overall survival if they can survive the first 24 hours after the overdose.

The three domains of life The three domains of life
The life cycle of the early diverging moss genus, Sphagnum, illustrating reproductive adaptations th The life cycle of the early diverging moss genus, Sphagnum, illustrating reproductive adaptations th
European wildcat feeding its kittens, as illustrated in Brehm's Life of Animals European wildcat feeding its kittens, as illustrated in Brehm's Life of Animals
Half-life Formula Half-life Formula
Generalized life cycle for land plants Generalized life cycle for land plants
Chloride and bicarbonate exchange in the renal tubules and effect of aldosterone on excretion of H+ Chloride and bicarbonate exchange in the renal tubules and effect of aldosterone on excretion of H+
Video: Contraction and Relaxation Animation

For a complete list of videos, visit our video library