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To the annuity holder, annuity payments are: Fully includable in gross income. S

ID: 2579602 • Letter: T

Question

To the annuity holder, annuity payments are:

Fully includable in gross income.

Similar to life insurance proceeds in that they are excluded from gross income.

First considered to be a tax-free return of the original purchase price.

In part a return of the original purchase price and in part taxable income.

Revised any time the life expectancy of the annuitant changes.

A.

Fully includable in gross income.

B.

Similar to life insurance proceeds in that they are excluded from gross income.

C.

First considered to be a tax-free return of the original purchase price.

D.

In part a return of the original purchase price and in part taxable income.

E.

Revised any time the life expectancy of the annuitant changes.

Explanation / Answer

To the annuity holder, annuity payments are In part a return of the original purchase price and in part taxable income. Option D is correct

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