Founded more than 60 years ago, National Western Life Insurance Company is chartered by the state of Colorado. National Western Life Insurance is committed to helping its policyholders grow and protect their assets for themselves and their loved ones through annuities and other insurance products.
When a nonqualified deferred annuity (an annuity where only the earnings are taxable) is inherited by an individual who is not the spouse, there are several ways the beneficiary can choose to have the money distributed to himself or herself, including:
1. Single payout. The individual can choose to take the proceeds in one lump sum.
2. Annual or Monthly Income for a Fixed Period. Equal income payments will be made for not less than 5 years nor more than 30 years.
3. Proceeds Held at Interest Only. Proceeds can be held at interest for up to 5 years. Interest payments can be paid on a period basis or held and accumulated. The beneficiary may elect to have funds applied to other distribution methods available from the company before the end of the interest period.
4. Annuitization. The beneficiary can also annuitize the proceeds so that during his or her life expectancy only part of the distribution payment is considered a gain and therefore taxable.
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