Neighbor Has A Buyout Offer I Need Guidance

[brett]

It did change the decision. I had seriously considered lump sum. The after tax number made that much less attractive. Delay proved the better of the two annuity options both from an after tax perspective and from a personal perspective.

 

[pb4uski]

One normally does not pay taxes on a lump sum right away.... typically a lum sum is rolled into a tIRA and is taxes as withdrawn... just like pension benefit payments are taxes when received.... that is why taxes usually don't make a difference in the decision.

I can see your point where someone is taking the lump sum as a taxable event.... that is bad because it typically pushes you into higher tax brackets so the tax cost is a lot more than either pension benefit payments or a non-taxable rollover and tIRA withdrawals.