Explore the 1,000’s of tax questions answered by professionals.

Back to list

QUESTION DETAIL

Related User

Votes

Is there any tax penalty associated with receiving income from an immediate annuity purchased with non-qualified funds prior to the age of 59 1/2?


ANSWER


The BIDaWIZ Team's Answer:

The short answer is yes as referenced in the Internal Revenue Code Section 72(q)(2)(I). Pre-59½ distributions from a non-qualified immediate annuity contract are excluded from an early withdrawal penalty. IRC Section 72(u)(4)(C) states that an "immediate annuity" means an annuity "which provides for a series of substantially equal periodic payments during the annuity period." This means that non-qualified immediate annuities should qualify for the 10 percent exception rule.

The BIDaWIZ Team

 

 

  • Currently 4.6190/5 Stars.
  • 1
  • 2
  • 3
  • 4
  • 5
1547 Ans.

COMPANY INFORMATION




We do not offer or provide any investment advice or services or opinion regarding the nature, potential, value, suitability or profitability of any particular security, portfolio of securities, transaction or investment strategy.

Copyright © 2024 BIDaWIZ, Inc. Privacy Policy | Terms & Conditions