Lauren owns an annuity that pays her $400 per month until she dies. Which of the following income tax concepts provides for the tax treatment of the annuity payments Lauren receives?
I.Annual Accounting Period Concept.
II.All-inclusive Income Concept.
III.Constructive Receipt Doctrine.
IV.Capital Recovery Concept.

Question

Lauren owns an annuity that pays her $400 per month until she dies. Which of the following income tax concepts provides for the tax treatment of the annuity payments Lauren receives?
I.Annual Accounting Period Concept.
II.All-inclusive Income Concept.
III.Constructive Receipt Doctrine.
IV.Capital Recovery Concept.
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Quizplus · Accepted Answer

The All-inclusive Income Concept includes all income unless specifically excluded, the Constructive Receipt Doctrine taxes income when it is made available, and the Capital Recovery Concept allows recovery of the investment in the annuity tax-free.

Lauren Owns an Annuity That Pays Her $400 Per Month