Death Benefit Options for Trust Beneficiary of Qualified Annuity?
What death benefit options do insurance companies offer to trusts as beneficiaries of qualified annuities? Does it make a difference from company to company? Is there a difference in death benefit options on qualified fixed annuities vs qualified variable annuities?
I’m being told that a trust can only elect a lump sum distribution for a qualified annuity, yet one claim form lists a stretch option, as well as a trustee to trustee transfer. I know a see through trust cannot stretch a non-qualified annuity, but it seems that a qualified trust should be able to stretch an IRA annuity.
Has anyone had success or failure in trying to establish inherited IRA accounts where the decedent held qualified annuities and named a trust as beneficiary?
Permalink Submitted by Alan - IRA critic on Thu, 2018-04-26 23:33
Is this an IRA annuity or another type of qualified annuity? Are you assuming that the trust itself is qualified for look through treatment? Those two characteristics will narrow down the options and determine what the IRS RMD requirements are. Once those are known, then the question is whether the insurance company will further restrict the options, which they can do.
Permalink Submitted by Audrey Mushinsky on Fri, 2018-04-27 00:23
I’m not sure what the difference is between an IRA annuity or other type of qualified annuity.IRA funds were invested in annuities, with the accounts being coded as IRAs.Assume the trust does quality as a see through trust.