Tax Sheltered Annuity - Premium Tax

The Tax-Sheltered Annuity Program is a supplemental retirement savings program authorized by section 403(b) of the Internal Revenue Code

Some states charge a tax on annuities.  The insurance company pays this tax to the state.  The company may subtract the amount of the tax when you pay your premium, when you withdraw your contract value, when you start to receive income payments or when it pays a death benefit to your beneficiary.

CAN MY ANNUITY'S VALUE BE DIFFERENT DEPENDING ON MY CHOICE OF BENEFITS?

While all deferred annuities offer a choice of benefits, some use different accumulated values to pay different benefits.  For example, an annuity may use one value if annuity payments are for retirement benefits and a different value if the annuity is surrendered.  As another example, an annuity may use one value for long-term care benefits and a different value if the annuity is surrendered.  You can't receive more than one benefit at the same time.

WHAT IS A "FREE LOOK" PROVISION?

Many states have laws which give you a set number of days to look at the annuity contract after you buy it.  If you decide during that time that you don't want the annuity, you can return the contract and get all your money back.  This is often referred to as a free look or right to return period.  The free look period should be prominently stated in your contract.  Be sure to read your contract carefully during the free look period.