For annuity rule purposes ( ¶ 1362 ),
the “expected return from the contract” is the total amount to be received (or
estimated to be received) under the contract. It is computed as of the annuity
starting date ( ¶ 1369 )
(
Code Sec. 72(b)(1) )
and doesn't take into account any amount for dividends or other payments *not*
received as an annuity ( ¶ 1373
). (
Code Sec. 72(c)(3) ; Reg § 1.72-7(a) ) FTC ¶ J-5124 et seq. ; USTR
¶ 724.14 ; Tax Desk ¶
146,564

*If the annuity is for a fixed term* and doesn't depend on any life
expectancy, the expected return is the amount of the payment specified for each
period multiplied by the number of periods. (
Reg § 1.72-5(c) )
FTC ¶ J-5130
; USTR
¶ 724.14 ; Tax Desk ¶ 146,570

*If the annuity is payable for life or joint lives,* the expected
return is the amount of the *annual* payment multiplied by the number of
years of life expectancy using IRS actuarial tables. (
Code Sec. 72(c)(3)(A) ; Reg § 1.72-5(a) ) FTC ¶ J-5126 et seq.; USTR
¶ 724.14 ; Tax Desk ¶ 146,564

*If the annuity is for an amount certain* payable in periodic
installments, the expected return is the total amount guaranteed. (
Reg § 1.72-5(d) )
FTC ¶ J-5131
; USTR
¶ 724.14 ; Tax Desk ¶ 146,571

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