title>Tax Guru-Ker$tetter Letter Wizard Animation


Tax Guru-Ker$tetter Letter
Friday, August 31, 2007
Annuities Cashed In


Subject: Annuity question

I recently had to cash in/surrender an annuity with a insurance company.  Naturally, I had to pay a surrender charge.  Is all or part of this charge a deduction using schedule D of capital gains/loss form?  Thanks.,



I'm assuming this annuity was in your personal name and not in an IRA or other kind of retirement account.

Just like a commission and other selling costs, the surrender charge would be added to the annuity's cost basis figure on your Schedule D; thus reducing the net taxable gain.

You really should be asking your personal professional tax advisor questions like this.  This is especially important for planning the best use of capital gains and losses for the year.

Good luck.

Kerry Kerstetter





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