- 1). Speak with your tax adviser regarding the implications of annuitizing your annuity. If you are under age 59 1/2, you need to use Internal Revenue Service (IRS) Regulation 72(t), which allows those under this age to take regular distributions without tax penalty as long as those distributions occur for at least five years.
- 2). Call the annuity company and request the forms for annuitizing your annuity contract. Ask what options are available: lifetime income or period certain. Lifetime income guarantees income for the remainder of your life; period certain income guarantees income for a designated number of years.
- 3). Fill out the forms and submit them to the annuity company. Submit any direct deposit information with the forms if you intend to have the distributions sent directly to a checking account.
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