NonQ Annuity
In 2020 I have a client who had 220k(200k basis) of nonQ funds in an annuity, we surrendered it and put it into another annuity(not realizing he was not 59.5) 6 months before he reaches 59.5. Tax time now and its showing 20k of taxable income w a 10% pre 59.5 penalty. Is there anything I can do to avoid that penalty?
Thanks
Permalink Submitted by Alan - IRA critic on Tue, 2021-04-27 16:32
There are not multiple penalty exceptions for the taxable portion of a NQ annuity distributions, as there are from other retirement plans. Was there a reason a 1035 exchange could not have been done?
Permalink Submitted by Zachariah Hammel on Tue, 2021-04-27 18:18
Nope, just a foul-up on my end…