Fifteen years ago, Mr. F paid $50,000 for a single-premium annuity contract. This year, he began receiving a $1,300 monthly payment that will continue for his life. On the basis of his age, he can expect to receive $312,000. Assume that on January 1, 2025, Mr. Fs unrecovered investment in the annuity is $1,875. (Round Exclusion ratio to 5 decimal places and intermediate calculations to the nearest whole dollar amount.)

a. How much of his total 2025 annuity payments ($15,600) are taxable?

b. Assume that he dies in February after receiving only one $1,300 payment. What are the tax consequences on his final Form 1040? What is the taxable income and itemized deduction on final form 1040?