By registering you will also receive quarterly Annuity Alerts that update your annuity information to reflect then current market conditions and your age. This could help you determine whether and/or when to purchase an annuity. See our privacy policy statement for how we handle your information.

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How much of my Annuity Payment is taxable?
Only $0 (0.0%) of your annuity payment is taxable each year until you reach age and 100% thereafter.
 Select your tax rate to see after tax payment amounts.

Under annuity tax rules, a portion of each payment is considered a return of principal excluded from taxation. Recognizing only a portion of your annuity payment in your tax return during this period might lower your overall tax rate and reduce the portion of any taxable Social Security payment. Click here to Learn Even More.







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    Gender: Male
    Age: 70
    Income Fequency: Annualy
    Premium: $100,000
    Annuity Payment: $0  
    Type of Annuity: Life with 10 Years  
    Single or Joint: Single
    Payment Pattern: Level
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If the source of premiums for the annuity is from personal savings and not a 401(k) or Rollover IRA, then a portion of your annuity payments is free from tax. While the actual formula is quite complex, the principles are straight forward. If a portion of your premium comes from funds that have already been taxed - or what is called a “cost basis,” - then that cost basis is recovered over the period of the payments. If that cost basis has not been recovered at the time of death, the unrecovered cost basis can be a deduction in the decedent's final tax return. If you make a withdrawal from your commuted value, then that amount may reflect the recovery of a cost basis.