Quote:
Originally Posted by Gigi3000
I'm 63, cost basis $160000, gain $200000. Bank advisor offered indexed variable annunity, 10 year spread. Anyone familiar with these? I have no experience with annunities. Trying to figure out whether to take lump sum and just pay the $70000 tax bill or do the annunity. If I take the annunity I'd put it into index mutual funds. My situation is very simple...I have no income, lots of savings, no mortgage on home, no tax deductions. If take annunity, goal.would be income I guess. Not taking social security, maybe take at 65.or wait until 70...
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Just making sure I understand this correctly, you have stock and the cost basis was $160,000; your gain was $200,000; so the value of the stock right now is $3i60,000 - correct. I think you taxes on a $200,000 gain with no income your gain would be taxed at 15% or $30,000 - not $70,000. If I'm misunderstanding and the current value is $200,00 - your gain would only be $40,000 and your tax - $6,000.
Either way, I would not get an annuity. Keep it in stock and don't cash it in all at once. Cash the newest - as long as you've had it at least a year. Only take out what you need AND only pay the tax on what you take out. If you're playing it safe because you made a lot of money in a short period of time and it's at least a one year investment - take it out, pay the tax, and thank the powers that be for the big gain.