Transferring annuity proceeds to IRA

[DHK]

Every dollar of tax is important and must be disclosed.

This is why licensing, E&O, and knowledge is important behind every transaction and coordinated with everything else.

Now, you claim that discussing taxes on 10% of one's retirement assets is immaterial???

It's still not your (lack of) license on the line.

And based on past threads that you shared, you barely HAVE 10% of the net worth being discussed in this thread.

Your mentality and thoughts on this thread are immaterial.

 

[Allen Trent]

Every dollar of tax is important and must be disclosed.

This is why licensing, E&O, and knowledge is important behind every transaction and coordinated with everything else.

Now, you claim that discussing taxes on 10% of one's retirement assets is immaterial???

It's still not your (lack of) license on the line.

And based on past threads that you shared, you barely HAVE 10% of the net worth being discussed in this thread.

Your mentality and thoughts on this thread are immaterial.

This seems a bit extreme, especially to bring up his assets, etc.

 

[DHK]

I'm over it.

I'm also over adjusterjack talking about things that he's clearly not well-versed in too. The fact that he first brought up a possible tax issue on an IRA trustee-to-trustee transaction (which has NONE)... that's telling to those of us who DO know and have been doing this kind of work for years.

 

[DHK]

The facts are... the OP was concerned about THIS issue, so those who knew what they're doing discussed THIS issue and THIS transaction.

 

[Allen Trent]

I'm over it.

I'm also over adjusterjack talking about things that he's clearly not well-versed in too. The fact that he first brought up a possible tax issue on an IRA trustee-to-trustee transaction (which has NONE)... that's telling to those of us who DO know and have been doing this kind of work for years.

In their defense, the OP never mentioned in their subject or post that their annuity/variable annuity was an IRA. The OP mentioned "annuity" 5 or 6 times, but never mentioned it was an IRA.

The OP asked if they could transfer their annuity to an IRA. The answer could be it is tax free transfer if existing annuity is an IRA or the answer could be no if the annuity is non qualified as there would be no legal way to get $320k of non qualified money into an IRA.

 

[DHK]

I do not trust a consumer to post a meticulously detailed post.

The post:
I am 77 years old with a net worth of 3M. Part of my portfolio includes a variable annuity I bought in 2007 for $320,000. I started drawing from it in 2017 and receive $25,000 per annum. My financial advisor now wants me to surrender the annuity with a surrender value of $319,000 and transfer the proceeds to my IRA to be invested in mutual funds. His rationale is that I currently pay 3% in charges for the annuity whereas the mutual funds only cost me 1.19% annually. Is this wise? The funds in the annuity do not perform as well as those in the IRA but on the other hand, I am guaranteed $25,000 per year until death at which time, whatever remains goes to my wife as an insurance death benefit. Please let me know what you think.

There is no way to make a $319,000 IRA contribution.

The only way to do that is an IRA trustee-to-trustee transfer. Therefore, the variable annuity must (by default) be an IRA rollover.