# What Is an Exclusion Ratio?

The exclusion ratio is a financial ratio that is used to measure the profitability of a company. It is calculated by dividing the net income of the company by the number of shares outstanding. The higher the ratio, the more profitable the company is. What is another term for pure life annuity? A pure life annuity is an annuity that pays out a fixed stream of payments for the lifetime of the annuitant, without providing for any payments to beneficiaries after the annuitant's death.

#### What method is used to determine the tax portion of each annuity payment?

There are a few different ways to calculate the tax portion of an annuity payment, but the most common method is to use the taxpayer's marginal tax rate. To calculate the tax portion of an annuity payment using this method, simply multiply the payment amount by the taxpayer's marginal tax rate. For example, if a taxpayer's marginal tax rate is 25% and they receive an annuity payment of \$1,000, the tax portion of the payment would be \$250. Why is the exclusion ratio applied to each annuity payment? The exclusion ratio is applied to each annuity payment in order to calculate the taxable portion of the payment. The exclusion ratio is calculated by dividing the total amount of the annuity payments by the total amount of the investment in the annuity. The taxable portion of each payment is equal to the exclusion ratio multiplied by the payment amount. Are annuities included in gross income? Yes, annuities are included in gross income.

### What does deferred annuity mean?

A deferred annuity is a type of annuity that allows investors to make regular payments into the account, but does not begin making payments to the investor until a future date. The payments are then made on a regular basis, typically monthly or annually, for the rest of the investor's life.