Which of the following is not a true statement regarding the income taxation of annuities?
A) Investment earnings are taxed when withdrawn and not when accrued,
B) Dividends on participating policies are not taxed when received,
C) The exclusion ratio represents the amount of a benefit payment that can be excluded from taxable income,
D) A penalty tax of 10 percent is charged for excess accumulations within the annuity if withdrawals are not started by age 59.5.
Correct Answer:
Verified
Q28: Match the descriptions with their terms:
-The _
Q29: Match the descriptions with their terms:
-A/An _
Q30: Match the descriptions with their terms:
-The _
Q31: Assume an exclusion ratio of 75 percent
Q32: If Harry can purchase a straight life
Q34: An annuity guarantees payments for the lifetime
Q35: Which of the following would have the
Q36: A 10-year period-certain guarantee
A) is not available
Q37: Jill, age 39, can buy a deferred
Q38: An annuity that would be particularly suitable
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