Discover The Best Way To Deal With Annuity Taxes

Annuity taxes can and indeed should play a significant role in determining which investment is right for you.

It does have to be stressed, of course, that tax relief is never the most important consideration, because if you make a bad investment and receive no income at all, it will come as absolutely no consolation that you are not paying any tax.

The profitability of the investment vehicle must be the most important consideration. Only when this profitability is guaranteed, or at least highly likely, can you really afford to be worrying about taxation.

Fixed annuities are becoming more popular than ever, as more people seek to protect their wealth and investment against erosion by inflation, and against confiscatory taxation. A bank certificate of deposit, which can be a very effective short term investment, still has the problem of being taxed on annual income.

This unfortunate feature has the effect of dissipating the money which would otherwise have accrued using compound interest. It is for this reason that certificates of deposit are rarely considered as suitable investments for a retirement fund, besides the fact that these days they pay next to nothing in interest.

It does have to be mentioned, though, that fixed annuities can have a sting in the tail in certain situations. If part of your aim is to pass money on to your children or other heirs, you need to think about the impact of the lack of the step up in basis rule. This can mean that a very large percentage of the money you have lovingly built up over the years using as deferred fixed annuity ends up in government hands after all. The money put into a fixed annuity is designed to be used for your retirement, so make sure that that is the primary consideration.

The alternative to this strategy, if you want to find another investment which is more friendly when it comes to avoiding inheritance taxes, is to take out a life insurance annuity or structured settlement payout that someone else is receiving from an insurance company due to an injury or accident claim. This policy operates as closely as possible to the way a fixed annuity would operate. If you know that you will only use a small percentage of your accumulated wealth during your retirement years, and that most of it will go to your heirs or beneficiaries, then this is likely to be the best way for you to go.

In summary, the best way of approaching the problem of annuity taxes depends on your main purpose in creating your savings plan in the first place. If you are intending to use the annuity for its intended purpose, which is to accumulate savings for your retirement, then you will do best by sticking with the tried and trusted system. If, on the other hand, you know that you will be leaving most of the money to your heirs, go for a life assurance solution instead, or possible a combination of both. Take the appropriate advice before you finally decide how to handle annuity taxes.






 

Annuities News:

 

'This was hush money': Ex-King County deputy's $160000 settlement lacked proper oversight - Seattle Times

Seattle Times

'This was hush money': Ex-King County deputy's $160000 settlement lacked proper oversight
Seattle Times
Two years ago, King County paid an outspoken sheriff's deputy more than $160,000 in cash, legal costs and back pay as part of an unusual settlement that was structured in a way that it did not receive the required level of scrutiny for a settlement of .

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Comparing JG Wentworth (JGW) & JetPay (JTPY) - TrueBlueTribune

Comparing JG Wentworth (JGW) & JetPay (JTPY)
TrueBlueTribune
The Company conducts its operations through two segments: Structured Settlements and Annuity Purchasing (Structured Settlements), and Home Lending. The Structured Settlements segment provides liquidity to individuals with various financial assets, such .

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Council, board decisions await Hilliard voters - ThisWeek Community News

Council, board decisions await Hilliard voters
ThisWeek Community News
Carrier, 47, is a structured settlement consultant for Arcadia Settlements Group. He is completing his first term after his election in 2013. McGivern, 50, is an executive at Molina Health Care and is seeking her third term on city council. She is vice .

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JetPay Corporation (JTPY) versus JG Wentworth (JGW) Critical Contrast - The Ledger Gazette

JetPay Corporation (JTPY) versus JG Wentworth (JGW) Critical Contrast
The Ledger Gazette
The Company conducts its operations through two segments: Structured Settlements and Annuity Purchasing (Structured Settlements), and Home Lending. The Structured Settlements segment provides liquidity to individuals with various financial assets, such .

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Both major parties represented in Hilliard City Council race - ThisWeek Community News

ThisWeek Community News

Both major parties represented in Hilliard City Council race
ThisWeek Community News
Carrier, 48, is a structured-settlement consultant for Arcadia Settlements Group. He is severing his first term after his election in 2013. EURœI strongly support a transition to a city-manager form of government,EUR Carrier said. He said he also favors the .

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JG Wentworth (JGW) and JetPay Corporation (JTPY) Head to Head . - Dispatch Tribunal

JG Wentworth (JGW) and JetPay Corporation (JTPY) Head to Head .
Dispatch Tribunal
JetPay Corporation (NASDAQ: JTPY) and JG Wentworth (NYSE:JGW) are both small-cap business services companies, but which is the superior stock? We will .

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Custom Structured Settlements Ensuring Extra Asset Protection - PR Web (press release)

PR Web (press release)

Custom Structured Settlements Ensuring Extra Asset Protection
PR Web (press release)
Custom Structured Settlements, the leader in no-tax solutions for business scaling and exits, integrates its unique VIP„  Process and CARE„  strategies with state-of-the-art trusts for extra asset protection. EURœWhenever assets are not directly controlled .

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