Originally Posted by target2019
Was researching inherited annuity this weekend. You either take a lump sum, or distribute over 5 years.
If annuity payments have not yet begun an inheritor typically also has the option to spread payments over his/her lifespan.
To reflect payments you will receive a 1099-R, and for tax purposes the income is treated much like that of a traditional IRA withdrawal. Some states treat annuity payments the same as pension payments, which may qualify the payments for some state income tax relief.