ProductsCâu 22 / 110
A customer wants to move the full value of an existing non-qualified variable annuity into a different insurer's non-qualified annuity. Handled correctly, this transaction:
a.Triggers ordinary income tax on the entire account value
b.Triggers tax only on the amount that exceeds the original cost basis
c.Is prohibited because annuity contracts cannot be transferred between insurers
d.Is a 1035 exchange and is not a taxable event, though surrender charges may still apply
Giải thích
Section 1035 of the Internal Revenue Code allows an annuity-to-annuity exchange without current taxation as long as the funds move directly between carriers and the annuitant does not take possession. Cost basis carries over to the new contract. The exchange does not waive the old contract's surrender charges or the new contract's new surrender schedule, which is why suitability review is required.
Trích dẫn luật: Internal Revenue Code Section 1035Luyện miễn phí toàn bộ 110 câu hỏi — không cần đăng ký.
Câu hỏi liên quan cùng chủ đề
- Which annuity payout option generally produces the largest monthly payment for a given account value?
- A married couple, both age 66, want annuity income that continues for as long as either of them is alive. Which settlement option fits?
- A surrender charge on a deferred variable annuity is best described as:
- Which of the following exchanges does NOT qualify for tax-free treatment under Section 1035?
- A 52-year-old owner of a non-qualified deferred annuity withdraws $20,000 from a contract with $60,000 of earnings and $40,000 of after-tax contributions. What is the tax result?
- When a non-qualified annuity is annuitized, the exclusion ratio is used to:
Cập nhật gần nhất: · quy trình kiểm tra
Đội Ngũ Biên Tập PrepPass · Đối chiếu với FINRA Series 6 — Investment Company & Variable Contracts Rep · Quy trình kiểm tra