I live in nys and i recieved an annuity death benefit. Is this taxable?

If so, on the annuity death benefit claim form, should I select do not withold taxes if i elect to take one lump sum? If it is taxable, do you think I will have to pay a lot back at the end of the year?

Yes. There are ways around it though. Consult a financial advisor, they ''know'' money (that is afterall what they do.)

I'm not sure, but my guess is yes. Our wonderful government taxes EVERYTHING now-a-days, f(_)cker$!

You haven't told us either your total other income or the amount of the annuity.

Yes, it's taxable. If you take a lump sum, it's added to this year's income and can push you into a higher tax bracket. If you are getting $5000 and you are in a 25% tax bracket, that would be another $1250 in taxes. If you don't have any taxes withheld, you would have to come up with the money at tax time (and if it's a lot, pay an estimated tax penalty for failing to send the money in).

That depends upon the annuity. If it's from a life insurance policy the amount that represents the death benefit portion is not taxable unless you are the owner of the policy. The portion that represents interest on the periodic payout is always taxable.

Would therefore need more information to give a proper answer to the question.