hich of the following statements regarding the tax treatment of distributions from an individually owned, nonqualified, deferred annuity is NOT correct? An owner of a deferred annuity who annuitizes the contract will receive the basis tax-free. If the contract owner is younger than age 59 , a partial surrender may be subject to a 10% penalty in addition to ordinary income taxation. If the contract owner makes a partial surrender, the amount withdrawn is treated first as a taxable distribution of gain (LIFO). If the distribution is the result of the annuity contract owner's death, the cash value payable to the beneficiary is income tax-free