Annuities
4 months ago
Annuity 1035 exchange — can I swap a bad annuity for a better one tax-free?
28
I bought a variable annuity 8 years ago with high fees (3.4% all-in) and a $210k current value ($185k cost basis). The surrender charge is finally at 0%. I've heard of a 1035 exchange — can I swap this for a low-cost annuity (like a Fidelity variable annuity at 0.25%) without triggering taxes on the $25k gain? What are the rules? Does the new annuity have a new surrender period?
DR
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