Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev | Next
Author: peppermintpatty Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 19257  
Subject: Re: Annunity Laws Date: 10/12/2000 7:56 AM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
Pixy - You said:

<<Earnings taken before age 59 1/2 are penalized and taxed just as they are in a traditional IRA or annuity. In the latter two, part of any withdrawal is always considered composed of already taxed contributions>>

Actually, withdrawals from a non-qualified tax-deferred annuity may be 100% taxable as ordinary income because of LIFO (last in - first out) rule. When making an ordinary withdrawal permitted by the contract, an annuity holder withdraws gain before basis. The way around this is to "annuitize" the sum (in whole or in part), thereby receiving a portion of the basis with every income payment. Right?

Best wishes, PP
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev | Next

Announcements

Post of the Day:
Value Hounds

Ubiquiti Analysis
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement