I'm a bit confused. You said, if indeed the amounts invested are less than all of the withdrawals from the account then you would have a loss on the investment.
That sounds like a gain to me. If I put in 50,000, but pulled out 51,000 (withdrawals & surrender), that would be a gain of a 1,000 wouldn't it?
That helps :-).
Here are the numbers:
Initial Premium: 123,271 April 2004 (Non-qualified money)--It was 1035 exchanged into a deffered annuity.
Cost basis left 117,108 (123,271 - 6,163)
Surrender Money Received: 105,365 (August 2009)
Loss of 11,743 (117,108 - 105,365).
The 105,365 will go immediately into an immediate annuity (non-qualified). My concern, will I have to pay tax on the 105,365 that we received in surrender charges, or is there a way to not have to pay any tax on this at all until the immediate annuity starts to pay out beyond the cost basis of 105,365. I am wondering if the only way to do this is with the 1035 exchange that should have taken place, but didn't.
I know this is complicated, I will compensate you fairly if you can bring clarity to the issue.
The money came from a fixed index annuity so there was no interested credited to the annuity. I don't know what the surrender charge was, I only know what the check amounts were that were sent to me after the surrender.
That makes sense.
However, even after all the figuring it looks like some tax would be due on the money.
Thanks for the time on this issue.