Getting to know inherited annuities

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As a leading provider of annuities, we see our products as more than just contracts. Our annuities are transparent and easy to understand, so you always know what to expect.

If you are a non-spousal beneficiary, you have the option to put the money you inherited into an inherited annuity from MassMutual Ascend! Inherited annuities may provide a way for you to spread out your tax liability, while allowing your inheritance to continue growing.

What are the benefits of an inherited annuity contract?

Continue the annuity’s growth

By placing the death benefit into an inherited contract, your assets may continue to grow tax deferred, which can provide a significant boost to your inheritance over time.

Spread income tax impact over time

Taking your death benefit as a lump sum payment could leave you with a significant tax burden. By opening an inherited contract, your money will not be taxed until you take a distribution.

You can designate your own beneficiaries

One day you can pass your loved one’s generosity on to your heirs.

Other important factors

Timing is important

In many cases, the IRS requires the first payment from an inherited IRA to be made by December 31 of the calendar year following the owner’s death. Similarly, the first payment from an inherited non-qualified contract must be made by the first anniversary of the owner’s death.

Understand your options

If the death benefit amount is paid directly to you, an inherited contract will no longer be an option. If you decide to open an inherited contract, the death benefit amount will need to stay at MassMutual Ascend or be transferred directly to another insurance carrier. 

Consider annual payment and final distribution requirements

In many cases, the IRS requires you to withdraw a minimum amount each year, known as a Required Minimum Distribution (RMD) for an inherited IRA or a 72(s) Payment for an inherited non-qualified contract. In some cases, the entire remaining balance of the inherited IRA must be distributed by December 31st of the calendar year containing the tenth anniversary of the owner’s death.

Seek advice from a professional

Your decision could have tax or other consequences that you may not have considered. To help avoid surprises, we recommend talking with a tax advisor or a financial professional before you make a decision. 

If you’re interested in an inherited annuity contract, please work with your financial professional. If you have questions, or need help finding a financial professional, please call us at 800-854-3649.

For use with contract forms P1074514ID, P1470218ID, P1113516ID, P1471718ID, P1126818ID, P1135619ID, P1140119ID, P1146620ID, P1140219ID, P1110416ID, ICC20-P1144420NW and ICC20-P1144420NW-NoMVA, ICC20-P1144520NW and ICC20-P1144520NW-NoMVA, ICC20-P1474420NW and ICC20-P1474420NW-NoMVA, P1080010ID, P1457113ID, P1129918ID, P1129918ID-NoMVA, P1134618ID, P1112916ID, P1470017ID, P1104414ID, P1138919ID, P1088011ID, P1088111ID, P1463016ID, P1459716ID, P1123117ID, P1123217ID, P1133518ID, P1086811ID, P1081610ID, P1822217ID, P1822317ID, P1825218ID. Form numbers vary by state.

MassMutual AscendSM is not an investment adviser, and the information provided in this document is not investment advice. You should consult your investment professional for advice based on your personal circumstances and financial situation.

This information is not intended or written to be used as legal or tax advice. It was written solely to provide general information and support the sale of annuity products. You should seek advice on legal or tax questions based on your particular circumstances from an attorney or tax advisor.

Products issued by MassMutual Ascend Life Insurance CompanySM (Cincinnati, Ohio), a wholly owned subsidiary of Massachusetts Mutual Life Insurance Company (MassMutual).

This content does not apply in the state of New York.

Not a bank or credit union deposit or obligation - Not FDIC or NCUA-insured - Not insured by any federal government agency - May lose value - Not guaranteed by any bank or credit union

Topic Tags
Annuities
Retirement

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