Annuity loss reported on tax return
With account values being down, some of my non-qualified annuity clients taking income are below their cost basis. Can they take the loss off of their taxes as they could on a mutual fund? If so, what proof do you have to show?
Permalink Submitted by mk foss on Thu, 2009-03-19 21:02
A loss on a nonqualified annuity is treated the same as an IRA loss. If you cash it in for less than the basis, it generates a miscellaneous deduction subject to the 2% limitation. If the owner is in AMT, there is no benefit from the loss.