thegreynold
Junior Member
What is the name of your state (only U.S. law)? CALIFORNIA
My Grandmother passed away this year and I've been named the sole beneficiary of a Non-Qualified Annuity which she had originally opened in 2003for $30,000. According to the insurance company, my Grandmother had taken a total of $7,000 out of gained interest between 2003-2010. I have been advised that the annuity is currently worth $30,200 if I choose to receive a payout in a lump sum. Also, the insurance company has asked if I want to withhold taxes or not...
1. What is my tax exposure?
Is my thinking correct that I will only be taxed on the $200 in interested gained and not on the entire original $30,000?
2. Do I need to worry about the $7,000 that my Grandmother had taken out in interest already or was she already taxed each year accordingly for it?
3. Will the $30,000 count as income and push me into another tax bracket or is it only the $200 in interest/gain that counts as income?
4. Do I need to have any taxes withheld if I choose to have a lump sum payout?
ThanksWhat is the name of your state (only U.S. law)?
My Grandmother passed away this year and I've been named the sole beneficiary of a Non-Qualified Annuity which she had originally opened in 2003for $30,000. According to the insurance company, my Grandmother had taken a total of $7,000 out of gained interest between 2003-2010. I have been advised that the annuity is currently worth $30,200 if I choose to receive a payout in a lump sum. Also, the insurance company has asked if I want to withhold taxes or not...
1. What is my tax exposure?
Is my thinking correct that I will only be taxed on the $200 in interested gained and not on the entire original $30,000?
2. Do I need to worry about the $7,000 that my Grandmother had taken out in interest already or was she already taxed each year accordingly for it?
3. Will the $30,000 count as income and push me into another tax bracket or is it only the $200 in interest/gain that counts as income?
4. Do I need to have any taxes withheld if I choose to have a lump sum payout?
ThanksWhat is the name of your state (only U.S. law)?