Sam,a Calendar Year Taxpayer,purchased an Annuity Contract for $3,600 That

question 4

Multiple Choice

Sam,a calendar year taxpayer,purchased an annuity contract for $3,600 that would pay him $120 a month beginning on January 1,2013.His expected return under the contract based on his life expectancy is $10,800.Assuming Sam received a total of $1,440 in payments during 2013,how much of this annuity income is included in Sam's gross income for 2013,using the general rule?

• A)$0
• B)$480
• C)$960
• D)$1,440
• E)None of the above

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