Monday, April 29, 2024
Charitable Deduction Methods

6.3.3 Basic Quiz -- Term-of-Years Annuity
A term-of-years annuity is an annuity created from the outset for a specific term of years.
     True      False
A term-of-years annuity can only be created to assist a young person with college expenses.
     True      False
Boris created a deferred annuity for Natasha when she was 50 years old to begin payments when she turns 70. Natasha is now 65 and would like to exercise her option to compress the payments over a four-year period. Natasha may do this but it will affect the timing of the taxation on the annuity payments.
     True      False
The payments from a term-of-years annuity are taxable to the donor.
     True      False
An annuitant must elect the term-of-years option before the annuity starting date or lose the option to do so.
     True      False
If an annuitant elects the term-of-years option prior to the annuity starting date, the donor is immediately taxed on the full value of the annuity payments.
     True      False
Boris created an annuity with a term-of-years option for Natasha who is 14. The annuity starting date is Natasha's 18th birthday. Natasha's age will result in the imposition of an excise tax of 10% on the payments.
     True      False
The total taxes on a term-of-years annuity can be as high as approximately 62%.
     True      False
IRS Pub. 1457, Table H is used to adjust the charitable deduction for deferred charitable gift annuities.
     True      False
No portion of a deferred charitable gift annuity payment is tax-free.
     True      False



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