tess retires after 30 years of service with her employer she is 64 years old and has 698574
Tess retires after 30 years of service with her employer. She is 64 years old and has contributed $39,000 to her employer’s qualified pension fund. She elects to receive her retirement benefits as an annuity of $3,000 per month for the remainder of her life.
a. Assume that Tess retires in June 2012 and collects six annuity payments this year. What is her gross income from the annuity payments in the first year?
b. Assume that Tess lives 25 years after retiring. What is her gross income from the annuity payments in the twenty fourth year?
c. Assume that Tess dies after collecting 180 payments. She collected eight payments in the year of her death. What are Tess’s gross income and deductions from the annuity contract in the year of her death?