In 1998, Carol purchased a single life annuity for $150,000 that would pay her $15,000 per year for life beginning in 2010. Carol's life expectancy from 2010 forward on which the payments were based was 20 years.
a. How much would Carol include in income if she is still receiving payments in 2030?
b. If Carol dies in 2017 after receiving that year's payment, what is the unrecovered investment remaining?
c. How is the unrecovered investment treated for tax purposes?

Question

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The Answer of In 1998, Carol purchased a single life annuity for $150,000 that would pay her $15,000 per year for life beginning in 2010. Carol's life expectancy from 2010 forward on which the payments were based was 20 years.
a. How much would Carol include in income if she is still receiving payments in 2030?
b. If Carol dies in 2017 after receiving that year's payment, what is the unrecovered investment remaining?
c. How is the unrecovered investment treated for tax purposes?

In 1998, Carol Purchased a Single Life Annuity for $150,000