A customer has invested 20000 in a variable annuity. in the first year nav increases to 21100 at what rate wsill 1100 gain be taxed

Question

asked Mar 4, 2021 31.2k views

1 Answer

Arsenm · Answer 1 · 2021-03-08T18:28:44+0000

Answer: 0%

Step-by-step explanation:

The $20,000 contribution to the variable annuity is not taxed and neither is the gain, at least not yet.

With the variable annuity, the gains/earnings will be tax-deferred and the customer will only have to pay taxes when they withdraw the contributions.

When this happens they will be charged at the normal income tax rate.