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Business, 06.10.2019 04:30 jakeyywashere

A64-year-old taxpayer retires this year and receives the first payment on an annuity that was purchased several years ago. the taxpayer’s investment in the annuity is $97,500, and the annuity pays $1,000 per month for the remainder of the taxpayer’s life. based on irs mortality tables, the taxpayer is expected to live another 20 years. if the taxpayer receives $4,000 in annuity payments in the current year, the nontaxable portion calculated using the simplified method is:

(a) 0
(b) $1,500
(c) $1,400
(d) $4,000
(e) none of above

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