Nonqualified plan

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Nonqualified plan

A retirement plan that does not meet the IRS requirements for favorable tax treatment.

Nonqualified Plan

An annuity or pension plan that one buys individually rather than through an employer. Nonqualified plans are not subject to the same restrictions as qualified plans. As a result, withdrawal penalties are smaller or non-existent, and one may continue to make contributions to a more advanced age (sometime until the annuitant is over 80). In the United States, specific restrictions on nonqualified plans are set at the state level. The IRS does not regulate them; as a result, contributions are not tax-deductible, but earnings still are.
References in periodicals archive ?
Annuity LTC plans: Annuity/LTC plans with tax-qualified benefits allow a holder of a non-qualified annuity to get benefits out of the policy, tax free, to pay for LTC.
Clients should consult their financial professionals and tax advisors to explore these post-death "inherited" IRA or "inherited" non-qualified annuity distribution options.
A non-qualified annuity is purchased with after tax dollars and is not part of an employers sponsored retirement plan or IRA).
Annuities - non-qualified annuity holders may receive a stream of annuity contracts with balance of contract continuing to accumulate tax-deferred.
There's another avenue you might not be familiar with: the use of an existing non-qualified annuity to fund a life-based LTC policy.
The increase, which includes the addition of deposits from American General Annuity (AGA), reflects strong sales in both the tax-qualified and non-qualified annuity markets.
A non-qualified annuity is purchased with after-tax dollars by individual investors and not used within a qualified retirement plan.
IRC Section 72(s)(2) allows the non-qualified annuity to be distributed over the life expectancy of a designated individual beneficiary as long as distributions start no later than 1 year after the annuitant's death.
WNH`s non-qualified annuity business provides a good complement to the AGC`s retirement services unit that primarily operates in the qualified annuity market.
SunGard Insurance Systems, an operating group of SunGard (NYSE:SDS), today announced that TIAA-CREF Life Insurance Company has gone live with SunGard Versatile Illustration Partner (VIP), SunGard Insurance Systems' enterprise wide illustration system, for its non-qualified annuity channel.
An existing non-qualified annuity or a new non-qualified annuity purchased with money from a CD or other low-performing asset can be used to generate tax-free money to pay the premium on long-term care insurance (LTCI).
In addition, a substantial portion of its premium income represents sales of non-qualified annuity contracts, which are subject to potential adverse tax legislation, and the continuing evolution of state and federal laws which may permit direct participation of banks in the annuity marketplace.

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