Partial vs. Lump-Sum Sales

Partial vs. Lump-Sum Sales Partial annuity sales and lump-sum sales are both good options for managing debt or freeing up cash for growth investment opportunities. What is a Partial Sale? In a partial sale, you either sell your right to receive a certain number of future payments or sell the payments that are scheduled for a certain period of time. The specifies differ depending on the type of annuity you have, how many payments you've received, which payments you're looking to sell and when the disbursement period ends. What is a Lump-Sum Sale? The key difference between a partial sale and a lump-sum sale is the ability to specify the exact dollar amount you want to receive from your annuity. Lump-sum sales allow you to receive a specific amount  of money instead of a certain number of payments that may not equal the precise amount you need. Can You Sell Your Annuity in Its Entirety? Yes, you can sell the full value of your annuity contract. Keep in mind that doing so will liquidate the asset and you will no longer retain the rights to any future income payments. Taxation of Sales Just as with annuity withdrawals, taxes are applied only to interest and earnings when you sell payments from an annuity that was purchased with after-tax money. You most likely won't have to pay taxes on the proceeds from your sale if you're selling payments from an annuity that funds a structured settlement.