Annuity Type

Resource

Payment

Revocable

Cash Surrender Value is an available resource

Conversion of resource – not income

Irrevocable

Is it?

If Yes to all –

Unavailable Resource

If Yes to all –

Unearned income of the annuitant

If both spouses are the annuitants, divide the payment equally between them

• Immediate

Yes

No

• Nonassignable

Yes

No

• Paying out in equal monthly payments

or changed to pay out in equal monthly payments

or requested that we calculate and budget in equal monthly payments

Yes

No

• Meeting the actuarial life expectancy rules¹

Yes

No

If No to any –

Available Resource

If right to payment or beneficiary cannot be sold, asset transfer rules apply

If No to any –

Not Income.

If annuity is retained, payments are a conversion of one type of resource to another

• Issued by entity licensed to do business in the purchaser jurisdiction

Yes

No

• Meeting beneficiary designation rules²

Yes

No

Retirement annuities –

Section 408 and 408A  of the Internal Revenue Code

• Individual Retirement Annuities
• Deemed IRAs under qualified employer plans
• Purchased with proceeds from
  • IRA
  • Employer/employee association trust
  • Simple retirement account
  • Simplified employee pension account or trust
  • Roth IRA

• Meeting beneficiary designation rules²

Yes

No

If Yes –

Unavailable Resource

If Yes –

Unearned income of the annuitant

If No –

Available Resource

If No –

Not income

If annuity is retained payments are a conversion of one type of resource to another