Defined terms for the annuity market and lifetime income landscape.
A 1035 exchange is a tax-free transfer of one annuity contract for another annuity contract — or of certain other insurance products — under Section 1035 of the Internal Revenue Code, which preserves the contract owner's cost basis and defers any built-in gain until a future taxable event. Why it matters The 1035 exchange is the mechanism by which a contract owner can move from one annuity to another without triggering tax on accumulated gain, making the tax cost of switching cont
