3.8% Medicare Surtax on Pensions

[Burke]

My info says "annuity payouts" are subject to this tax. IRA's & 401k's, etc are not. Does this encompass any taxable, defined-benefit pension paid from a company where the taxpayer was employed? I am thinking since it says "unearned income" from investments, it is primarily referring to an annuity policy purchased with taxpayer funds?

[Roland Slugg]

The taxable portion of a purchased annuity is considered investment income and will be subject to the new 3.8% Medicare tax, beginning in 2013, if the taxpayer's income exceeds the $200k/$250k threshold. Ordinary pensions, including retirement benefits and distributions from an IRA, Roth IRA, 401(k), 403(b) or 457 plan are not investment income, and will not be subject to that new tax. If IRA funds were used to purchase an annuity, I don't believe distributions therefrom would be subject to the new 3.8% tax.

[S T]

I have been receiving a lot of information from some of my Insurance/Annuity Sources, and I found this link http://www.fpamn.org/members/Program...are-Surtax.pdf

I have not reviewed for accuracy, however, the comparisons and Tables appear to outline, the what ifs.

Sandy