Tax break sought for non-qualified lifetime annuities

Bill would provide exclusion on annual income from investments up to $20,000

Jun 23, 2009 @ 12:39 pm

By Darla Mercado

Two senators have reintroduced legislation that would provide tax breaks to those with non-qualified lifetime annuities.

Sens. Kent Conrad, D-N.D., and Pat Roberts, R-Kan., have proposed the Retirement Security for Life Act, or S 1297, which would provide a 50% tax exclusion on the annual income from a non-qualified lifetime annuity, up to $20,000.

The Conrad-Roberts bill is similar to the Retirement Security Needs Lifetime Pay Act, HR 2748, which was proposed recently by Reps. Earl Pomeroy, D-N.D., and Ginny Brown-Waite, R-Fla.

That measure also would provide a 50% tax exclusion for a portion of lifetime-income payments from non-qualified annuities, up to $20,000, as well as a 25% tax exclusion for a portion of payments received under a qualified retirement plans.

The new Conrad-Roberts bill was referred to the Senate Finance Committee.

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