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I am the executor for a testamentary pass through trust for the benefit of my 70yr old brother. Right now, the trust is entirely fixed income; bonds, reits, preferreds. I have been concerned that there is no growth in the trust, but reinvested captitol gains could be taxed on the trust at almost 40%.

I am not normally in favor of annuities, but a variable annuity could grow in value tax free to the trust and my brother could take out more income for himself later on. There is not a huge amount in the trust and other than SS this is it when he can't work anymore. Am I doing the right thing by using an annuity for the trust? I am beginning to think that in his case this may be the only game in town.

birgit aka follydolly
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