Final answer:
The statement that is accurate concerning an individual Straight Life annuity is: "Payments are made to an annuitant for life."
The answer is option ⇒4
Step-by-step explanation:
A Straight Life annuity is a type of annuity contract that guarantees regular payments to the annuitant for their entire life, regardless of their life expectancy. This means that as long as the annuitant is alive, they will continue to receive payments from the annuity.
It is important to note that the other statements listed in the question are not accurate:
- Life expectancy of the annuitant is a factor in determining the payment amount for some annuity types, but not for a Straight Life annuity. With a Straight Life annuity, the payments are fixed and do not depend on the annuitant's life expectancy.
- The tax treatment of annuity payments depends on several factors, such as the source of the funds used to purchase the annuity and the annuitant's tax situation. While some annuity payments may be partially or fully tax-free under certain circumstances, it is not a general rule that all payments from a Straight Life annuity are received tax-free.
- A Straight Life annuity is not limited to employees of nonprofit charitable, educational, and religious organizations. It is a type of annuity contract that can be available to individuals regardless of their employment status or the type of organization they work for.
The answer is option ⇒4
Your question is incomplete, but most probably the full question was:
Which of these statements concerning an individual Straight Life annuity is accurate?
- Life expectancy of the annuitant is not a factor
- The payments are received tax-free
- Only available to employees of nonprofit charitable, educational, and religous organizations
- Payments are made to an annuitant for life