What are some estate planning concerns regarding my annuity?
According to current tax laws, many equity and fixed-income investments (such as stocks, bonds, and mutual funds) have the tax advantage of a step-up in cost basis when distributed to heirs; however when an annuity is received by a beneficiary, he or she may face ordinary income taxes on any gains in the original annuity contract. This could have a negative impact on the overall wealth being passed on to your heirs. But please consult your tax or legal advisor to understand the impact concerning your specific circumstances.
