457(b) direct rollover to annuity ?

[Guest bluefish]

I am fully retired from local gov. civil service, and have full access to my 457(b) plan. Will the IRS allow me to "directly rollover" all or part of my 457 funds for the purchase of a life insurance annuity without the exchange being treated as a taxable event ? Isn't an annuity purchase/ exchange via 457 funds considered a lateral transfer to a qualified retirement plan? I would appreciate any help here. Thanks.

[joel]

bluefish Posted on Jul 31 2004, 02:12 PM

I am fully retired from local gov. civil service, and have full access to my 457(b) plan. Will the IRS allow me to "directly rollover" all or part of my 457 funds for the purchase of a life insurance annuity without the exchange being treated as a taxable event ? Isn't an annuity purchase/ exchange via 457 funds considered a lateral transfer to a qualified retirement plan? I would appreciate any help here. Thanks.

===================================================

Yes, you may rollover your 457 funds to another eligible retirement plan. But why are you thinking of rolling it over to an annuity? Do you intend to annuitize immediately which means you voluntarily transfer the title to your 457(b) funds to the insurance company in return for a guaranteed lifetime income?

[Guest bluefish]

I was considering purchasing a foreign annuity contract with various options and lots of flexibility - particularly in terms of safety, security, and asset protection. Can anyone refer me to the specific IRS code/statute/notice that would allow such tranfer or direct rollover ?

[Guest Joel Lee]

Please elaborate on just what is a foreign annuity contract. What percentage of your net worth would you be investing?

[Guest bluefish]

I'm considering investing approximately 25% of my financial resources in a Swiss annuity contract with a Swiss life insurance company. Before I even consider it further I need to know if the IRS will allow it as I have specified in my original posting.