5 year rule for annuities
Can’t figure out what is the deadline date for application of the 5 year rule. Is it exactly 5 years after date of death, or 12/31 of the year 5 years after death?
Most articles say before 5 years have elapsed after death, but a few say by 12/31 of the year 5 years after death.
I’m not sure of what is correct now.
Permalink Submitted by Alan - IRA critic on Sat, 2020-09-19 17:41
For a NQ annuity, the account must be drained 5 years from the DOD. For an IRA annuity, the IRA rules govern and the deadline is 12/31 of the 5th year following the year of death.
Permalink Submitted by Vickie Intriago on Mon, 2020-09-21 15:28
Does the 5 year rule apply for variable annuities that are accumulating? Merely, using for income protection, if we trigger it.
Permalink Submitted by Alan - IRA critic on Mon, 2020-09-21 18:56
It applies to all NQ annuities unless the issuer uses some other provision in the contract.
Permalink Submitted by Toby Hartley on Tue, 2020-09-29 17:06
Alan, I was just told by a few carriers that they are no longer allowing deferral (5yr) for NQ annuities as the secure act elminated that option. That’s news to me. Any insight?
Permalink Submitted by William Gordon on Tue, 2020-09-29 22:44
https://irahelp.com/comment/61424#comment-61424