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What are the tax implications of transferring cash-value life insurance or annuities?

April 26, 2017annuities implications Life Insurance tax transferring

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What are the tax implications of transferring cash-value life insurance or annuities?

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Section 1035 of the tax code allows for the tax-free exchange between like contracts: 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. We advise you to check with your financial advisor or tax professional for further information.