Changing annuitants

[FBN2007]

What is the name of your state (only U.S. law)? MD

Can the annuitant of a single premium immediate annuity be changed to a non spouse once annuity payments have started? The annuitant and owner are the same person and are living. If it is possible, then would the payments be considered a gift by the owner to the new annuitant and require a gift tax return?

 

[Betty]

It's contract specific. You would need to read your annuity contract. If you need help, contact the company that issued the annuity.

 

[tranquility]

I agree with Betty for the first question and, for the second, yes. (Most probably as there are not a ton of small annuity contracts out there.) If a tax deferred annuity, probably not. There money is more of a trust than a contact and it would probably require a distribution first before gifting.

 

[anteater]

I have never seen an immediate annuity contract that would permit that.

Think about what an immediate annuity is and how is calculated!

But, hey, if you find out that it can be done, please post back and let us know the company.

 

[Betty]

Since we don't know complete details re the type of annuity or any of the provisions, see what the issuing co. says.

 

[anteater]

It's a "single premium immediate annuity."

 

[Betty]

I know that but that's about all we know. We don't know if it is one that has a revocable bene (annuitant) or irrevocable bene, any tax advantages -- just knowing it is a single prem. immediate annuity doesn't allow us to answer the OP's questions.

We don't completely know what "type" of single prem. immediate annuity this is -- there are different types of immediate annuities & different choices the OP can make re various options .... & we don't know the annuity provisions.

They are contract specific - each annuity.

It's just like there are different types of single prem. whole life life ins. policies & with different pol. provisions etc.

 

[anteater]

I know that but that's about all we know. We don't know if it is one that has a revocable bene (annuitant) or irrevocable bene, any tax advantages -- just knowing it is a single prem. immediate annuity doesn't allow us to answer the OP's questions.

We don't completely know what "type" of single prem. immediate annuity this is -- there are different types of immediate annuities & different choices the OP can make re various options .... & we don't know the annuity provisions.

They are contract specific - each annuity.

It's just like there are different types of single prem. whole life life ins. policies & with different pol. provisions etc.

All true (almost), but...

Payments to the annuitant have already begun and the OP is talking about changing the annuitant. Not the beneficiary - if any beneficiary options were chosen.

There is always a first time, but I have never seen or heard of a SPIA contract that would permit a change of annuitant.

(The analogy would be wanting to change the insured after execution of a life insurance contract.)

 

[Betty]

An annuitant is the person receiving the benefits/income from the annuity - some people refer to this person as the "beneficiary" of the annuity. The owner of the annuity can be different than the annuitant. If they are the same, they (owner) can name a bene to receive any survivor benefits at owner/annuitant's death. If the owner & annuitant are the same & benefits are being paid to the owner/annuitant, depending on the annuity, the owner/annuitant while living can request that they start paying benefits to another person - a recalculation is done. One of my cousin's uncle had an annuity where he did this - stopped annuity payments to himself & had them go to my cousin. It can be done if allowed by the annuity - it would be rarely done though. An annuity & life ins. policy are quite a bit different. (can't compare in many ways)

Anyway; if I was the OP, I would talk to the co. that issued the annuity. It won't hurt anything.