Withdrawl from annuity

[Lykele]

What is the name of your state? Kentucky

At the current time my wife and I have a joint variable annuity. Are there any consequences in changing it to a variable annuity in only my name?

Why? I am 62 years old and my wife is 54. My belief is if we took money out of this annuity now that half of it would be subject to a 10% federal tax penalty because she is not 59 1/2. My portion, because of my age, would not incur a penalty. Unless, of course, I'm completely wrong about that.

Thanks. Jim

 

[seniorjudge]

What is the name of your state? Kentucky

At the current time my wife and I have a joint variable annuity. Are there any consequences in changing it to a variable annuity in only my name?

Why? I am 62 years old and my wife is 54. My belief is if we took money out of this annuity now that half of it would be subject to a 10% federal tax penalty because she is not 59 1/2. My portion, because of my age, would not incur a penalty. Unless, of course, I'm completely wrong about that.

Thanks. Jim

bump....


I'd like to know the answer also....

 

[LdiJ]

Well...in thinking this through there are no tax consequences in gifting property or assets between spouses, therefore there should be no tax consequences in your wife gifting her share of the annuity to you.

 

[Lykele]

Would that "gifting" have to adhere to the $12,000 limit as in gift tax?

Recently someone else suggested that the name and social security number reported with the distribution would determine who paid taxes and/or penalty. Does that hold any logic?

 

[LdiJ]

Would that "gifting" have to adhere to the $12,000 limit as in gift tax?

Recently someone else suggested that the name and social security number reported with the distribution would determine who paid taxes and/or penalty. Does that hold any logic?

No....gifting between spouses has nothing to do with the 12k limit.

Yes, the name and SS# reported with the distribution determines tax consequences.