Minnie owns a qualified annuity that cost $78,000. The annuity is to pay Minnie $650 per month

Question:

Minnie owns a qualified annuity that cost $78,000. The annuity is to pay Minnie $650 per month for life after she reaches age 65. Minnie turns 65 on September 28, 2011, and receives her first payment on November 1, 2011.

a. How much gross income does Minnie have from the annuity payments she receives in 2011?

b. Shortly after receiving her payment on October 1, 2026, Minnie is killed in an automobile accident. How does the executor of Minnie's estate account for the annuity on her return for the year 2026?

c. Assume that the accident does not occur until November 1, 2035. How does the executor of Minnie's estate account for the annuity on her 2035 return?

Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...