Life Insurance & Annuities: Frequently asked questions

What are the tax implications of transferring cash-value life insurance, annuities, or 401(k) money?

Section 1035 of the tax code allows for the tax-free exchange between like accounts: annuity to annuity, life insurance policy to life insurance policy, and life insurance policy to annuity. However, you cannot go from an annuity to a life insurance policy because of the additional benefits of the life policy face value.

There's more information on annuity transfers here.

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