Deferred annuities

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Related to Deferred annuities: Fixed annuities, Variable annuities, Immediate Annuities

Deferred annuities

Tax-advantaged life insurance products. Deferred annuities offer deferral of taxes with the option of withdrawing one's funds in the form of a life annuity.

Deferred Annuity

An annuity in which the annuitant does not begin to receive payments until some future date. A deferred annuity has two phases: a savings phase and an income phase. During the savings phase, the annuitant places money into the annuity, which invests it on behalf of the annuitant. In the income phase, the annuitant receives payments. It is important to note that a deferred annuity is not taxed until the income phase begins. It also pays a death benefit to the survivor(s) of the annuitant. Nearly all retirement plans are deferred annuities. See also: IRA, 401(k).

Tax-Deferred Annuity

A retirement plan in which an employee makes tax-deferred contributions from his/her pre-tax income. The employee is not taxed on the contribution until he/she begins to make withdrawals after retirement. Strictly speaking, a 401(k) is a tax-deferred annuity, but the term especially applies to a 403(b) plan, which is directed at teachers and employees of tax-exempt organizations, such as charities or churches.
References in periodicals archive ?
Deferred annuities are primarily purchased for two reasons.
The IRS has been made aware that it would be actuarially unreasonable for insurers to offer a deferred annuity at a price that does not vary based on the purchaser's age, and, accordingly, a TDF that holds deferred annuities should not be expected to permit participants whose ages fall outside the designated age range for the TDF to hold an interest in that TDF
The Story: QLACs-Qualified Longevity Annuity Contracts-are deferred annuities that are exempt from required minimum distribution requirements.
However, with Lloydshare's deferred annuities program, all of those fears are a thing of the past.
However, this deferral may come at a price, because, similar to IRAs, deferred annuities are subject to early withdrawal penalties when withdrawals occur prior to age 59 1/2 (under Sec.
Three such alternatives are tax deferred annuities, tax-free investments and savings bonds.
Of particular promise, the 2012 study by the President's Council of Economic Advisors said, was a special class of deferred annuities the council referred to as longevity annuities.
com)-- Lloydshare Limited continues to support its Host Resorts by offering continual education opportunities on the Vacation Ownership Linked Deferred Annuities to sales staff and management at each resort property.
Sound bites from securities regulators on why deferred annuities are bad often settle on surrender charges.
The sales and marketing of these deferred annuities are chock-full of misleading promises to policyholders," said Rob Carey, managing partner of Hagens Berman Sobol Shapiro in Phoenix.
The complaint also claims these materially false and misleading statements and omissions fraudulently induced purchases of the deferred annuities because they give the impression that the product provides the key tax deferral benefit sought by investors, when, in fact, tax deferral is not a reason for qualified plan investors to purchase the product because any investment funding a qualified plain is already tax deferred.