John purchased an annuity from Prudential Ins. Co. in 2006 when he was 50 years old. John paid Prudential $ 32,400 for the annuity. The annuity will start paying John $ 800 per month starting on 7/1/16 when John turns age 60. Payments are for a 15 year fixed period.
a) How much taxable income will John report from this annuity in 2016?
B) How much taxable income will John report from this annuity in 2017?
C) What if instead of a fixed annuity, John purchased a Life Annuity that will pay him $ 9,000 per year ($ 750 per month) starting at age 68. The cost of the annuity is $ 47,520. How much is taxable in 2024 when John turns age 68 and starts receiving payments on 7/1/2024)?
D) How much is taxable in 2025?