Question for the Money Doctors

Question submitted on Dec 15, 2012.

Question

My mom has a revocable trust where the primary items in the trust are annuity contracts. Can we transfer the annuity contracts to a revocable trust without incurring a tax penalty

Answer

You should be able to complete a section 1035 exchange and transfer the annuity contracts to another revocable trust.

For additional information visit http://www.360financialliteracy.org/