When he retired at age 65, Andy was chief of offshore operations at Pelican Exploration Corporation. While employed, Andy participated in Pelicans contributory qualified pension plan, to which he had contributed $250,000 (in after-tax dollars). Under one of the plan options, he chose a life-annuity payout of $60,000 per year over his life. As part of his retirement package, Andy also received nontaxable health insurance coverage.