Endowment policy in iRA
I have a situation where, according to a 2007 form 5498 my client has an IRA account with an insurance company. Apparently, it is some form of life insurance endowment policy. [ It is stated “endowment at age 65 – IRA on the premium notice]
My client wishes to surrender the policy and is asking whether it qualifies for an IRA rollover. He does not wish to do a 1035 exchange but a 60-day rollover into an IRA account holding stock funds.
Is is permissable to rollover the cash surrender value of such policies when held inside an IRA?
Thank you
Permalink Submitted by Alan Spross on Mon, 2008-06-23 20:23
It should be permissible.
Permalink Submitted by Al Fry on Tue, 2008-06-24 03:28
HE DOES NOT NEED TO DO A ROLLOVER, IT CAN BE A TRUSTEE-TO- TRUSTEE TRANSFER. 1035 REFERS TO A NON-QUALIFIED EXCHANGE. kEEP IN MIND, IF THE DEATH BENEFIT IS HIGHER THAN THE CV, HE WILL BE LOSING THAT.