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Is the Private Annuity Trust a “secured obligation”?

April 26, 2017Annuity private Trust

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Is the Private Annuity Trust a “secured obligation”?

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A. No. The Private Annuity Trust must be an unsecured obligation. The IRS does not allow this type of tax strategy if the annuity is secured. In essence, the trust cannot be secured by the underlying assets as a guarantee to the annuitant.