I have a client age 69 who executed a 1035 exchange from one annuity to another and is now wanting to cancell during the free look period. Hence, the funds need to be sent back to where they came from as the receiving company has not agreed to 1035 the funds to a third company during the free look period. When they send the funds back to the first company, is it customary that they will receive the funds back into the annuity that they originally came from without triggering a taxable event?
Thank you,