All are characteristics of annuities, except: - ProProfs
     

All are characteristics of annuities, except:



A. Annuities may use a beneficiary designationin case of the annuitant s death
B. Premature distributions are subject to a 15% penalty tax in order to discourage the use of annuity contracts as a short-term tax shelter.
C. Owners of individual annuities have contracted rights beginning at the time of purchase.
D. Business Corporations may use annuities to provide pensions for employees, either nonqualified or qualified plans, or to structure payments of liability settlements.

This question is part of Chapter 14 Annuities

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1 Answer

John Smith

John Smith

Answered on Apr 19, 2017

Premature distributions are subject to a 15% penalty tax in order to discourage the use of annuity contracts as a short-term tax shelter.

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