business EIT and LST -REAL ESTATE PALS UC UNEMPLOYMENT T miguel payroll ess eBoo
ID: 2332197 • Letter: B
Question
business EIT and LST -REAL ESTATE PALS UC UNEMPLOYMENT T miguel payroll ess eBook E Annuity payment table Calculatr Earned and Unearned Income (LO. 2) Partha owns a qualified annuity that cost $52,000. under the contract, when he reaches age 65, he will receive $500 per month untit 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 SL-55,520 | from the annuity payments in 2018. Check Myverk Tax lavw views the amounts paid out under the contract as being a retun of the original capital investment and a return on the capital investment Next All work saved. 252 PM CALExplanation / Answer
1.We need to calculate the Monthly amount which need to excluded first to arrive at taxable amount.
That is =Investment in the annuity/Number of months the annuity is expected to be received.
The annuity is based on the life of the taxpayer, so number of months is calculated using the annuity table. When received payments partha's age will be 65 years so based on which his payments is expected to be 260 from the annuity table.
Monthly exlusion= $52,000/260= 20
So balance Monthly gross income =$500-$200= $300 .
Income for the Year 2018= $300*7 Months= $2,100
2)
a)Charolte has a taxable income of $ 3000 in december when she receives the gazebo, Joe has taxable income of $ 3000 in january when he receive the will
b)Ed has income of $500 ($4,500 - $4,000) in 2017. Realization is important thats why $4,600 is not considered when calculating gain
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