Fifteen years ago, Mr. Fairhold paid $65,000 for a single-premium annuity contract. This year, he began receiving a $2,000 monthly payment that will continue for his life. On the basis of his age, he can expect to receive $405,600. Assume that on January 1, 2025, Mr. Fairhold's unrecovered investment in the annuity is $2,575. Required: a. How much of his total 2025 annuity payments ($24,000) are taxable? b. Assume that he dies in February after receiving only one $2,000 payment. What are the tax consequences on his final Form 1040? Complete this question by entering your answers in the tabs below. Required A Required B How much of his total 2025 annuity payments ($24,000) are taxable? Total annuity payment taxable Fifteen years ago, Mr. Fairhold paid $65,000 for a single-premium annuity contract. This year, he began receiving a $2,000 monthly payment that will continue for his life. On the basis of his age, he can expect to receive $405,600. Assume that on January 1, 2025, Mr. Fairhold's unrecovered investment in the annuity is $2,575. Required: a. How much of his total 2025 annuity payments ($24,000) are taxable? b. Assume that he dies in February after receiving only one $2,000 payment. What are the tax consequences on his final Form 1040? Complete this question by entering your answers in the tabs below. Required A Required B Assume that he dies in February after receiving only one $2,000 payment. What are the tax consequences on his final Form 1040? (Round Exclusion ratio to 5 decimal places and intermediate calculations to the nearest whole dollar amount.) Amount Taxable income Itemized deduction on final Form 1040