wendynj924
Member
What is the name of your state (only U.S. law)? nj
If you become a beneficiary of an annunity, do you have to pay taxes on that sum?
If you become a beneficiary of an annunity, do you have to pay taxes on that sum?
State and federal governments need taxes to operate. To the extent that an asset increases in value, at some point that increase in value is usually subject to income tax at the federal level and if your state has income tax, at the state level.More correctly you need to pay income taxes when it is paid out to you....and there might be federal or state estate or inheritance taxes that somebody owes ..
If, by beneficiary, you mean that the annuitant died and you received a death benefit (basically life insurance) then, no, I don't think you pay taxes on it.What is the name of your state (only U.S. law)? nj
If you become a beneficiary of an annuity, do you have to pay taxes on that sum?
The best answer is maybe.If, by beneficiary, you mean that the annuitant died and you received a death benefit (basically life insurance) then, no, I don't think you pay taxes on it.
However, if the annuitant had arranged for any payments to continue to you for any amount of time after his/her death then, yes, all or part may be taxable.
You need to sit down with a tax pro and have him/her go over the exact details to determine tax treatment, if any.