Are there tax breaks for retirees?

Nicole Stevens

tax dayAnnuities have become common place, especially among retirees. Not many know the tax benefits of having an annuity. Here you’ll find out what an annuity can be, how it protects you, and the huge tax benefit an annuity holds.

In most cases, an annuity is typically offered by an insurance company to protect the buyer at risk of outliving their income. Something such as this is very beneficial to a retired person, keeping an insured steady flow of income without continuing to work. You pay into the annuity, and when the time comes to start receiving it back, it can be a high sum (upwards into the 100,000’s).

When annuities are being paid out if taxed the rates could be sky high, and a good chunk of that money would be gone in no time. Thankfully, there is a way to get your annuity sans tax! As long as the money is used to pay for quality long-term care, it will not be taxed. This amount includes money deposited into the account and interest built up.

This is all thanks to the Pension Protection Act of 2006, keeping annuity payments not subject to tax so long as they’re used for the proper care, starting back in 2010. Work alongside your insurance provider to figure out a plan for your future with an annuity today. 


Make the REST of your life
the BEST of your life.

For more than 14 years our mission at West Financial Group has been to guide our valued clients to financial security. We strive to address all of your concerns, ensure you understand the products we recommend and take pride in knowing you’re comfortable with the direction and strategy we provide you.

Our goal is to provide a “WOW” experience at every client interaction! We want every meeting, phone call and event to be an interaction worth talking about. We want our clients to be able to say, “WOW, what an experience! I can't wait to tell my friends about our financial professional.”

Whether it’s financial, retirement, legacy planning or optimizing your future wealth, our approach includes understanding your unique situation, exploring your goals and discovering the best way to make the REST of your life, the BEST of your life. By getting to know you and your family, we serve as financial guides who keep your best interests in mind throughout the entire process.

Skip West | Financial Planner | West Financial Group

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