Can an annuity beneficiary be changed?

The owner can change beneficiaries at any time as long as the contract does not require an irrevocable beneficiary to be named. They can also choose multiple beneficiaries and a contingent beneficiary — people designated to receive payments if the primary beneficiary dies before the owner.

Can I transfer my annuity to someone else?

If you have money saved up in an annuity contract that you don’t need, you can easily transfer the annuity to someone else. Contact your annuity company and let your account manager know you want to change the owner of your contract. The annuity company will send you a change of ownership form.

Can a beneficiary of an inherited annuity change their name?

Inherited annuities are taxable as income. The beneficiary of a tax-deferred annuity may choose from several payout options, which will determine how the income benefit will be taxed. If the beneficiary is the spouse of the annuitant, the spouse can change the contract into his or her own name.

When does the beneficiary of an annuity pay taxes?

When you die and the annuity proceeds are paid, the tax deferred earnings will be taxed as ordinary income to your beneficiary. There is a spousal provision whereby if the beneficiary is your spouse they will have the option to continue to defer the taxes in the annuity.

Who is the beneficiary of a variable annuity when the owner dies?

For most variable annuities, beneficiaries receive at least the original amount the owner contributed. For fixed annuities, the beneficiary receives the present value of payments. For some immediate annuities, such as a lifetime immediate income annuity without term certain, the insurance company keeps the money when the owner dies.

Can a trust be used as a beneficiary of an annuity?

In some situations, using an annuity’s own beneficiary designation with “restricted payout” may be a viable alternative, saving on both the cost of the trust itself and preserving the stretch.