« previous next »

Author Question: Juanita paid a life insurer 45,000 in exchange for an immediate life annuity. Juanita will receive ... (Read 176 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?

Side effects from substance abuse include nausea, dehydration, reduced productivitiy, and dependence. Though these effects usually worsen over time, the constant need for the substance often overcomes rational thinking.

Did you know?

Lower drug doses for elderly patients should be used first, with titrations of the dose as tolerated to prevent unwanted drug-related pharmacodynamic effects.

Did you know?

The first monoclonal antibodies were made exclusively from mouse cells. Some are now fully human, which means they are likely to be safer and may be more effective than older monoclonal antibodies.

Did you know?

The liver is the only organ that has the ability to regenerate itself after certain types of damage. As much as 25% of the liver can be removed, and it will still regenerate back to its original shape and size. However, the liver cannot regenerate after severe damage caused by alcohol.

Did you know?

In 2012, nearly 24 milliion Americans, aged 12 and older, had abused an illicit drug, according to the National Institute on Drug Abuse (NIDA).

Crying Frequency in the Early Months In their first months of life, infants often cry for no appare Crying Frequency in the Early Months In their first months of life, infants often cry for no appare
Life cycle of Giardia. Life cycle of Giardia.
How to solve a half life problem involving exponential models (Question 2) How to solve a half life problem involving exponential models (Question 2)
Life Cycle Nutrition: Toddlers through the Later Years Life Cycle Nutrition: Toddlers through the Later Years
Carbon-11 is used in medical imaging. The half-life of this radioisotope is 20.4 min. What ... Carbon-11 is used in medical imaging. The half-life of this radioisotope is 20.4 min. What ...
Video: Peptide Bond Formation Animation

For a complete list of videos, visit our video library