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Partha owns a qualified annuity that cost $52,000. Under the contract, when he reaches age 65, he will receive $500 per month until he dies. Partha turns 65 on June 1, 2018, and receives his first payment on June 3, 2018. Refer to the Annuity payment table to answer the following question. Partha will report gross income of $______ from the annuity payments in 2018.

Respuesta :

Olajidey

Answer:

 =$2100

Explanation:

Figure out the amount of gross income by partha

The payment to be recieved monthly = $500

The number of payments to be recieved = 260 (Partha`s age is 65)

Thus,

Monthly exclusion = cost of annuiy / number of payments

       = [tex]\frac{52000}{260}[/tex]

         = $200

So,

Gross income = (monthly payment - monthly exclusion) * (nunmber of months)

       =  ($500 -  $200) * 7

        = $2100

Therefore,

partha will report gross income of $2100, from the annuity payment in 2018

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