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Death of Owner: Required Distribution
Federal tax law requires that certain distributions be made from an annuity in the event that any owner of the contract dies. If the owner of the contract is not a natural person, then the annuitant will be considered the owner for the purposes of the rule, and a change of annuitant is treated the same as the death of an owner for tax purposes.

Required distributions are as follows: Spousal Exception
There is one exception to the rule requiring distributions in the event of an owner’s death. If the beneficiary of the annuity is the surviving spouse of the deceased owner, then the surviving spouse is permitted to become the owner. Distributions will not be required until the surviving spouse’s subsequent death.

Printed with permission of Advanced Underwriting Consultants

Last Updated: 9/23/2012 10:05:00 PM