You mean a 1035 exchange to an IRA? Perhaps your annuity is an IRA already? What are you trying to accomplish by switching? Is there a surrender charge? How old are you? Are you looking at a Roth or Traditional IRA? You should be looking at switching to an IRA or annuity paying out 10% tax deferred interest guaranteed over the next 10 years depending on your age.
An annuity certainly can be purchased in an IRA, but one of the benefits of an annuity is tax deferral which you already have with an IRA. So as long as you understand that there are no additional tax benefits when placing an annuity in an IRA it may be an appropriate investment.
Only if the annuity is an IRA or Roth IRA. A non-qualified annuity does not have this rule.
To understand the consequences of borrowing from a deferred annuity (one in which annuity payments are not scheduled to commence within one year of issue), one needs to know if the annuity is being used to fund an IRA or "qualified plan". If the annuity is funding an IRA, no borrowing is permissible, because IRA rules do not permit borrowing from one's IRA. If the annuity is funding an employer-sponsored retirement plan (such as a 401(k) plan), borrowing may or may not be permitted by the plan (and the annuity contract). If the deferred annuity is being purchased with after-tax dollars, not in an IRA or employer-sponsored plan, then borrowing is not forbidden by law, but most deferred annuity contracts do not allow it. It should be noted that borrowing against such an annuity, or even pledging the annuity value as collateral for a loan (such as, from a bank) will cause the untaxed "gain" in the annuity to be taxable in the year of the pledging (up to the value of the amount borrowed) (IRC 72(e)(4)).
is my IRA annuity safe from creditors and mortgage foreclosure
My mother is 75 and is facing foreclosure on her property. She is concerned of what the mortgage company can seize of her personal property, especially her IRA, annuity and car. What are they legally allowed to take?
An annuity certainly can be purchased in an IRA, but one of the benefits of an annuity is tax deferral which you already have with an IRA. So as long as you understand that there are no additional tax benefits when placing an annuity in an IRA it may be an appropriate investment.
Only if the annuity is an IRA or Roth IRA. A non-qualified annuity does not have this rule.
No, the annuity has to be liquidated and rolled.
a 401K is a tax deferred qualified annuity similar to an IRA.
No
To understand the consequences of borrowing from a deferred annuity (one in which annuity payments are not scheduled to commence within one year of issue), one needs to know if the annuity is being used to fund an IRA or "qualified plan". If the annuity is funding an IRA, no borrowing is permissible, because IRA rules do not permit borrowing from one's IRA. If the annuity is funding an employer-sponsored retirement plan (such as a 401(k) plan), borrowing may or may not be permitted by the plan (and the annuity contract). If the deferred annuity is being purchased with after-tax dollars, not in an IRA or employer-sponsored plan, then borrowing is not forbidden by law, but most deferred annuity contracts do not allow it. It should be noted that borrowing against such an annuity, or even pledging the annuity value as collateral for a loan (such as, from a bank) will cause the untaxed "gain" in the annuity to be taxable in the year of the pledging (up to the value of the amount borrowed) (IRC 72(e)(4)).
When it is related to taxes, a Section 1035 refers to a tax free replacement to an annuity. It can also be used as a replacement for a life insurance policy.
No, unless it states it is an indexed annuity. If it just states that it is a fixed deferred annuity, then No. Deferred means that no taxes are paid until funds are removed, however by the nature of the Roth IRA interest is not taxable under the provisions of a Roth IRA with the IRC code.
Perhaps you meant a "non-qualified" annuity? If so, a nq annuity is an annuity purchased with after-tax dollars; conversely, a qualified annuity is one purchased with pre-tax dollars, such as in an IRA or a TSA.
is my IRA annuity safe from creditors and mortgage foreclosure
My mother is 75 and is facing foreclosure on her property. She is concerned of what the mortgage company can seize of her personal property, especially her IRA, annuity and car. What are they legally allowed to take?
No, distributions from an inherited IRA do not qualify for the New York State pension and annuity exclusion. This exclusion is generally meant for certain types of retirement income received as a pension or annuity from an employer's retirement plan, not for inherited IRAs.