Terry Receives $3,000 Annually from an Annuity Contract Which She

Terry receives $3,000 annually from an annuity contract which she purchased in 2003 for $15,000.Her total expected return under the contract is $45,000 and payments under the contract began in 2004.For the years 2004 through 2013,Terry received $3,000 per year.Of the $3,000 received during 2013,what amount must Terry include in her gross income for 2013 under the general rule?

A) $3,000
B) $2,062
C) $2,000
D) $1,000
E) None of the above

Correct Answer:

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