partial non qualifed 1035 exchange

Submitted by Douglas Bauerband on Fri, 2014-12-05 15:24

have client with 90k in a Variable annuity. We do not need the death benefit any longer so we do not want to pay the extra rider fees.

We are exchanging the 90k to two contracts. One annuity for principle protection for 25k and the other 65k to another annuity that is low cost.

Question: with all the new rules, is this okay or will the partial exchange to two different companies make any of the two sums taxable to my client?

Thank you,
Douglas



Submitted by Douglas Bauerband on Fri, 2014-12-05 21:15

thankyou very much,Dougals



Submitted by Alan - IRA critic on Sat, 2014-12-06 18:29

I think you can, but check with the current insuror, since how they handle any 1099 will indicate what the IRS expects to be reported.



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