Early Withdrawal Penalty

The 10 percent penalty the IRS requires you to pay if you withdraw money from a qualified retirement account or an annuity before age 59 ½. You will also be subject to federal and (if applicable) state taxes on your withdrawal.

Exclusion Ratio

This ratio determines the taxable and nontaxable portions of each payment from an immediate annuity, annuitization, or life insurance policy.   

Executor

The person named in a will to carry out the wishes of the deceased for the distribution of his or her assets. The executor fulfills his or her duties under court supervision.