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I am age 74. I satisfied the terminal illness requirements

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I am age 74....
I am age 74. I satisfied the terminal illness requirements of the annuity company to fully surrender my IRA annuity and receive a lump sum payment. I did this in 2015. Are there tax consequences considering I satisfied the terminal illness requirements.
Submitted: 1 year ago.Category: Tax
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4/14/2016
Tax Professional: Lev, Tax Advisor replied 1 year ago
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 30,162
Experience: Taxes, Immigration, Labor Relations
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That is an annuity purchased inside IRA account - correct?So distribution from the annuity would not be taxable .But funds from the annuity will go into IRA account and after that distributed to you.IRA distribution is taxable.You must have reporting form 1099R box 1 reports total distribution 'and box 2a - taxable amount.Please verify.
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Customer reply replied 1 year ago
I understand these requirements based upon normal circumstances. I surrendered my IRA because of terminal illness. Does this change anything?
Customer reply replied 1 year ago
Lets conduct business by email. Please answer my last question regarding tax consequences when the lump sum was provided based upon satisfying terminal illness of the annuity company
Customer reply replied 1 year ago
If I don't see something from you in the next 2 minutes, I will cancel my membership.
Tax Professional: Lev, Tax Advisor replied 1 year ago
That is not correct interpretation...
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Tax Professional: Lev, Tax Advisor replied 1 year ago
You did not surrender the IRA account.What you did surrender - is the annuity.But for IRA distribution that makes no difference.Were you able to verify what amount is reported on 1099R box 2a?I bet - you see taxable amount there - so the administrator of your IRA account determined that distribution as taxable.Sorry if you expected differently.
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Lev
Lev
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