Sharon owns a fixed deferred annuity contract with a 7-year surrender period, which she purchased at...

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Sharon owns a fixed deferred annuity contract with a 7-year surrender period, which she purchased at age 50 for $60,000. Now, 5 years later, she cashes in the contract for its $65,000 accumulated value. All of the following statements are correct EXCEPT A) Sharon will pay capital gains taxes on $65,000 B) Sharon will pay ordinary income taxes on $5,000 C) Sharon will pay a $500 penalty to the IRS OD) Sharon will pay a surrender charge to the insurer Sharon owns a fixed deferred annuity contract with a 7-year surrender period, which she purchased at age 50 for $60,000. Now, 5 years later, she cashes in the contract for its $65,000 accumulated value. All of the following statements are correct EXCEPT A) Sharon will pay capital gains taxes on $65,000 B) Sharon will pay ordinary income taxes on $5,000 C) Sharon will pay a $500 penalty to the IRS OD) Sharon will pay a surrender charge to the insurer

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