# 1035 Exchanges: How to Transfer Annuities and Life Insurance Without Paying Taxes Published: 2026-04-09 Author: Warren Team URL: https://www.heywarren.com/blog/1035-exchanges --- Most annuity and life insurance holders don't realize they can switch carriers, upgrade features, or redirect their coverage without paying a dime in taxes, even on six-figure accumulated gains. 1035 exchanges, named for Section 1035 of the Internal Revenue Code, make that possible. Yet the vast majority of policyholders have never used one. The misconception is that swapping an old, high-fee annuity for a better product means triggering a tax bill on every dollar of growth. For a policyholder sitting on $100,000 in gains, that can mean $22,000 or more in ordinary income taxes at a 22% federal rate. Without knowing about 1035 exchanges, most people stay locked in inferior products, or pay that tax unnecessarily. This guide explains exactly how 1035 exchanges work, which transfers qualify, how to execute one without costly mistakes, and how to evaluate whether an exchange makes sense for your situation. You'll leave with a clear framework, including the surrender charge math that advisors often underemphasize. For context: LIMRA estimates more than $2.7 trillion sits in individual annuity reserves in the United States. A meaningful share of those policyholders would benefit from a tax-free transfer but simply don't know the option exists. ## What Is a 1035 Exchange? A **[1035 exchange](/blog/10-35-exchange)** is a tax-free transfer of the accumulated value in one insurance or annuity contract to another, permitted under Internal Revenue Code Section 1035. The exchange lets policyholders move between products, updating features, changing companies, improving terms, without triggering a taxable event on accumulated gains. ![A 1035 exchange on $100,000 in gains at a 22% rate avoids $22,000 in immediate taxes versus a taxable surrender.](data:image/svg+xml,%3Csvg%20xmlns%3D%22http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%22%20viewBox%3D%220%200%20800%20210%22%20width%3D%22800%22%20height%3D%22210%22%20role%3D%22img%22%3E%3Ctitle%3EComparison%3C%2Ftitle%3E%3Crect%20width%3D%22100%25%22%20height%3D%22100%25%22%20fill%3D%22%23f8fafc%22%2F%3E%3Ctext%20x%3D%22230%22%20y%3D%2257.5%22%20text-anchor%3D%22end%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2214%22%20font-weight%3D%22600%22%20fill%3D%22%230f172a%22%3ETax%20via%20Surrender%3C%2Ftext%3E%3Crect%20x%3D%22240%22%20y%3D%2225%22%20width%3D%22450%22%20height%3D%2255%22%20rx%3D%226%22%20fill%3D%22%232563eb%22%2F%3E%3Ctext%20x%3D%22702%22%20y%3D%2257.5%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2214%22%20font-weight%3D%22700%22%20fill%3D%22%232563eb%22%3E%2422K%3C%2Ftext%3E%3Ctext%20x%3D%22230%22%20y%3D%22152.5%22%20text-anchor%3D%22end%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2214%22%20font-weight%3D%22600%22%20fill%3D%22%230f172a%22%3ETax%20via%201035%3C%2Ftext%3E%3Crect%20x%3D%22240%22%20y%3D%22120%22%20width%3D%226%22%20height%3D%2255%22%20rx%3D%226%22%20fill%3D%22%237c3aed%22%2F%3E%3Ctext%20x%3D%22258%22%20y%3D%22152.5%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2214%22%20font-weight%3D%22700%22%20fill%3D%22%237c3aed%22%3E%240%3C%2Ftext%3E%3C%2Fsvg%3E) *A 1035 exchange on $100,000 in gains at a 22% rate avoids $22,000 in immediate taxes versus a taxable surrender.* The policy basis transfers along with the value, maintaining the original cost basis in the new contract. You don't pay tax today. The gain stays deferred and will eventually be taxed when you take withdrawals or surrender the new contract. ### Why 1035 Exchanges Exist Congress designed Section 1035 to ensure policyholders aren't locked into inferior or unsuitable insurance and annuity products just to avoid tax. Without the exchange provision, switching from a high-fee annuity to a better product would immediately trigger taxes on all accumulated gains, a tax cost that would often outweigh the benefit of switching. Section 1035 removes that barrier to appropriate product transitions. ## What Transfers Are Permitted Under Section 1035? Section 1035 permits tax-free exchanges in specific directions only: life insurance can transfer to life insurance, annuities, or long-term care policies; annuities can move to other annuities or long-term care policies; endowments can move to life insurance or annuities. Moving from an annuity to a life insurance policy does not qualify, that exchange is fully taxable. ![1035 exchanges must follow a strict hierarchy, annuities cannot move up to life insurance tax-free.](data:image/svg+xml,%3Csvg%20xmlns%3D%22http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%22%20viewBox%3D%220%200%20600%20211%22%20width%3D%22600%22%20height%3D%22211%22%20role%3D%22img%22%3E%3Ctitle%3EHierarchy%3C%2Ftitle%3E%3Crect%20width%3D%22100%25%22%20height%3D%22100%25%22%20fill%3D%22%23f8fafc%22%2F%3E%3Crect%20x%3D%22220%22%20y%3D%2220%22%20width%3D%22160%22%20height%3D%2258%22%20rx%3D%228%22%20fill%3D%22%232563eb%22%2F%3E%3Ctext%20x%3D%22300%22%20y%3D%2254%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2214%22%20font-weight%3D%22700%22%20fill%3D%22white%22%3ELife%20Insurance%3C%2Ftext%3E%3Cpath%20d%3D%22M%20300%2078%20L%20300%20105.5%20L%20120%20105.5%20L%20120%20133%22%20stroke%3D%22%23cbd5e1%22%20stroke-width%3D%222%22%20fill%3D%22none%22%2F%3E%3Crect%20x%3D%2240%22%20y%3D%22133%22%20width%3D%22160%22%20height%3D%2258%22%20rx%3D%228%22%20fill%3D%22white%22%20stroke%3D%22%230891b2%22%20stroke-width%3D%222%22%2F%3E%3Ctext%20x%3D%22120%22%20y%3D%22158%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2213%22%20font-weight%3D%22600%22%20fill%3D%22%230f172a%22%3ELife%20Insurance%3C%2Ftext%3E%3Ctext%20x%3D%22120%22%20y%3D%22176%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2210%22%20fill%3D%22%2364748b%22%3ESame%20type%3C%2Ftext%3E%3Cpath%20d%3D%22M%20300%2078%20L%20300%20105.5%20L%20300%20105.5%20L%20300%20133%22%20stroke%3D%22%23cbd5e1%22%20stroke-width%3D%222%22%20fill%3D%22none%22%2F%3E%3Crect%20x%3D%22220%22%20y%3D%22133%22%20width%3D%22160%22%20height%3D%2258%22%20rx%3D%228%22%20fill%3D%22white%22%20stroke%3D%22%230891b2%22%20stroke-width%3D%222%22%2F%3E%3Ctext%20x%3D%22300%22%20y%3D%22158%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2213%22%20font-weight%3D%22600%22%20fill%3D%22%230f172a%22%3EAnnuity%3C%2Ftext%3E%3Ctext%20x%3D%22300%22%20y%3D%22176%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2210%22%20fill%3D%22%2364748b%22%3EPermitted%3C%2Ftext%3E%3Cpath%20d%3D%22M%20300%2078%20L%20300%20105.5%20L%20480%20105.5%20L%20480%20133%22%20stroke%3D%22%23cbd5e1%22%20stroke-width%3D%222%22%20fill%3D%22none%22%2F%3E%3Crect%20x%3D%22400%22%20y%3D%22133%22%20width%3D%22160%22%20height%3D%2258%22%20rx%3D%228%22%20fill%3D%22white%22%20stroke%3D%22%230891b2%22%20stroke-width%3D%222%22%2F%3E%3Ctext%20x%3D%22480%22%20y%3D%22158%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2213%22%20font-weight%3D%22600%22%20fill%3D%22%230f172a%22%3ELong-Term%20Care%3C%2Ftext%3E%3Ctext%20x%3D%22480%22%20y%3D%22176%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2210%22%20fill%3D%22%2364748b%22%3EPost-2006%3C%2Ftext%3E%3C%2Fsvg%3E) *1035 exchanges must follow a strict hierarchy, annuities cannot move up to life insurance tax-free.* ### Permitted 1035 Exchange Transfers | From | To | Permitted? | |------|----|-----------| | Life insurance | Life insurance | Yes | | Life insurance | Annuity | Yes | | Life insurance | Long-term care insurance | Yes (post-PKRA 2006) | | Annuity | Annuity | Yes | | Annuity | Long-term care insurance | Yes (post-PKRA 2006) | | Endowment | Life insurance | Yes | | Endowment | Annuity | Yes | | Annuity | Life insurance | **No, taxable** | **Critical rule**: You cannot exchange an annuity for life insurance and maintain tax-free status. The exchange must go "down" the hierarchy (life insurance → annuity, not the reverse) or stay within the same contract type. **The long-term care addition**: The Pension Protection Act of 2006 added long-term care insurance and hybrid LTC policies to the permitted exchange list. This allows annuity and life insurance values to fund LTC coverage tax-free. ### Same Insured Requirement For the exchange to qualify under Section 1035, the insured person (for life insurance) or annuitant must generally remain the same. You cannot use a 1035 exchange to transfer a policy on one person to a policy on a different person. **Joint ownership**: Section 1035 exchanges are permitted on jointly owned contracts, but ownership must remain the same after the exchange. ## 1035 Exchanges for Annuities: The Most Common Use The most common application of 1035 exchanges is swapping one annuity for another. Annuity-to-annuity transfers let policyholders move to newer products with lower fees, better income riders, or stronger investment options, all without triggering tax on accumulated gains. Variable annuity mortality and expense charges have declined sharply over the past decade, making this one of the most financially impactful uses of Section 1035. ### Why People Exchange Annuities **Lower fees**: Variable annuity mortality and expense (M&E) charges have declined considerably. An older VA with 1.5–2.0% M&E charges might be replaced by a newer product at 0.5–1.0%, a meaningful improvement in long-term accumulation. **Better riders**: Guaranteed minimum withdrawal benefits (GMWBs), guaranteed lifetime withdrawal benefits (GLWBs), and other living benefit riders have improved substantially. A 1035 exchange can access better income guarantees on the same accumulated value. **Different investment options**: Moving from limited subaccount options to a broader fund menu. **Changing annuity type**: Moving from a variable annuity to a fixed indexed annuity (FIA) to reduce market risk while maintaining upside potential. **Company credit quality**: Concerns about an insurer's financial strength may motivate a transfer to a more financially secure carrier. ### The Gain and Basis in an Annuity Exchange When you do a 1035 exchange, the cost basis in your old annuity transfers to the new contract: **Example**: You invested $100,000 in an annuity 15 years ago. It's now worth $200,000. - **Gain (deferred)**: $100,000 - **Basis**: $100,000 After a 1035 exchange into a new annuity: - **New annuity value**: $200,000 - **Transferred basis**: $100,000 - **Deferred gain**: Still $100,000, no tax due at exchange When you eventually take withdrawals from the new annuity, that $100,000 gain will be taxed as ordinary income. LIFO rules apply, gain comes out first. ## 1035 Exchanges for Life Insurance: When They Make Sense Life insurance 1035 exchanges let policyholders move from one permanent policy to another, or convert life insurance cash value into an annuity, without triggering income tax on accumulated gains. This matters when an existing policy becomes too expensive to maintain, a better product is available, or the death benefit need has declined and guaranteed retirement income is the new priority. ### Life Insurance to Life Insurance (Same Insurer or Different) Common reasons to exchange life insurance policies: - **Policy becoming unaffordable**: Older universal life policies with poor performance may require increasing premiums to maintain coverage. A 1035 exchange can fund a new, more sustainable policy. - **Better terms available**: Health improvement may qualify for better rates. A 1035 exchange funded with existing cash value can establish a new policy at lower cost. - **Product improvement**: Moving from traditional whole life to indexed universal life or variable universal life for better accumulation potential. - **Company change**: Concerns about insurer financial strength. **Important consideration**: When exchanging life insurance, insurability matters. The new policy requires medical [underwriting](/blog/what-is-underwriting). If the insured's health has declined, they may not qualify for a new policy, or may qualify only at substantially higher rates. ### Life Insurance to Annuity (Retirement Income Planning) Converting life insurance cash value to an annuity is common when: - The death benefit need has decreased (children grown, spouse deceased, estate planning needs changed) - The policyholder wants guaranteed retirement income - The annuity provides better tax-deferred growth or income options **Key consideration**: Once you exchange life insurance for an annuity, you lose the income-tax-free death benefit of life insurance. The annuity death benefit (return of account value) is taxable to beneficiaries. ### Life Insurance to Long-Term Care Coverage A 1035 exchange from life insurance to a hybrid LTC/life policy or standalone LTC policy allows cash value to fund LTC premiums. Under Section 1035 and Section 7702B: - The exchange can be tax-free - LTC benefits paid from a policy funded via 1035 exchange are generally income-tax-free - This approach is increasingly popular as a way to repurpose underperforming life insurance ## How to Execute a 1035 Exchange: Step-by-Step A 1035 exchange must be executed as a direct carrier-to-carrier transfer. The receiving (new) company initiates the paperwork and authorizes the transfer from the old carrier. Funds flow directly between companies, you never take possession of the money. Taking a distribution yourself and then buying a new policy eliminates the tax-free treatment entirely. ![Funds must flow directly carrier-to-carrier, taking a personal distribution destroys tax-free treatment.](data:image/svg+xml,%3Csvg%20xmlns%3D%22http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%22%20viewBox%3D%220%200%20660%20125%22%20width%3D%22660%22%20height%3D%22125%22%20role%3D%22img%22%3E%3Ctitle%3EFlow%20diagram%3C%2Ftitle%3E%3Crect%20width%3D%22100%25%22%20height%3D%22100%25%22%20fill%3D%22%23f8fafc%22%2F%3E%3Crect%20x%3D%2230%22%20y%3D%2225%22%20width%3D%22170%22%20height%3D%2275%22%20rx%3D%2210%22%20fill%3D%22white%22%20stroke%3D%22%232563eb%22%20stroke-width%3D%222%22%2F%3E%3Ctext%20x%3D%22115%22%20y%3D%2258.5%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2214%22%20font-weight%3D%22600%22%20fill%3D%22%230f172a%22%3EOld%20Contract%3C%2Ftext%3E%3Ctext%20x%3D%22115%22%20y%3D%2278.5%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2211%22%20fill%3D%22%2364748b%22%3EExisting%20carrier%3C%2Ftext%3E%3Cline%20x1%3D%22205%22%20y1%3D%2262.5%22%20x2%3D%22237%22%20y2%3D%2262.5%22%20stroke%3D%22%2364748b%22%20stroke-width%3D%222%22%2F%3E%3Cpolygon%20points%3D%22244%2C62.5%20235%2C57.5%20235%2C67.5%22%20fill%3D%22%2364748b%22%2F%3E%3Crect%20x%3D%22245%22%20y%3D%2225%22%20width%3D%22170%22%20height%3D%2275%22%20rx%3D%2210%22%20fill%3D%22white%22%20stroke%3D%22%232563eb%22%20stroke-width%3D%222%22%2F%3E%3Ctext%20x%3D%22330%22%20y%3D%2258.5%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2214%22%20font-weight%3D%22600%22%20fill%3D%22%230f172a%22%3EDirect%20Transfer%3C%2Ftext%3E%3Ctext%20x%3D%22330%22%20y%3D%2278.5%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2211%22%20fill%3D%22%2364748b%22%3ECarrier%20to%20carrier%3C%2Ftext%3E%3Cline%20x1%3D%22420%22%20y1%3D%2262.5%22%20x2%3D%22452%22%20y2%3D%2262.5%22%20stroke%3D%22%2364748b%22%20stroke-width%3D%222%22%2F%3E%3Cpolygon%20points%3D%22459%2C62.5%20450%2C57.5%20450%2C67.5%22%20fill%3D%22%2364748b%22%2F%3E%3Crect%20x%3D%22460%22%20y%3D%2225%22%20width%3D%22170%22%20height%3D%2275%22%20rx%3D%2210%22%20fill%3D%22white%22%20stroke%3D%22%232563eb%22%20stroke-width%3D%222%22%2F%3E%3Ctext%20x%3D%22545%22%20y%3D%2258.5%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2214%22%20font-weight%3D%22600%22%20fill%3D%22%230f172a%22%3ENew%20Contract%3C%2Ftext%3E%3Ctext%20x%3D%22545%22%20y%3D%2278.5%22%20text-anchor%3D%22middle%22%20font-family%3D%22system-ui%2C-apple-system%2Csans-serif%22%20font-size%3D%2211%22%20fill%3D%22%2364748b%22%3EBasis%20transfers%3C%2Ftext%3E%3C%2Fsvg%3E) *Funds must flow directly carrier-to-carrier, taking a personal distribution destroys tax-free treatment.* ### Step 1: Identify the Receiving Company and Policy Shop for the replacement product before initiating the exchange. Compare: - Fees (for annuities: M&E charges, administrative fees, investment management fees) - Surrender charges on the new product - Features and riders - Company financial strength ratings ### Step 2: Obtain a Current Statement from Your Existing Policy Get the current accumulated value, surrender value, cost basis, and any outstanding loans on your existing policy. ### Step 3: Complete the 1035 Exchange Forms at the Receiving Company The **new (receiving) company handles the exchange**. You complete their 1035 exchange forms, which authorize a direct transfer from the old carrier. Do not take the funds yourself. ### Step 4: The Direct Transfer Funds must flow directly from the old carrier to the new carrier. You never receive a check. The insurance contract exchange is reported on [IRS](https://www.irs.gov/) Form 1099-R with distribution code "6," indicating a tax-free 1035 exchange. ### Step 5: Verify Receipt and Documentation Confirm the new policy is issued with the correct transferred basis. Keep records of the exchange documentation, the basis information is critical for future tax reporting. ### The "Never Touch the Money" Rule **The most critical rule in 1035 exchanges**: You must never receive the funds yourself. If you take a distribution from the old contract and fund a new one, you've created a taxable event on the full accumulated gain. The transfer must be carrier-to-carrier, directly. ## Surrender Charges: The Practical Complication Surrender charges are the most common obstacle to 1035 exchanges. Most annuities assess surrender charges, typically 5–10% declining over 7–10 years, when you transfer out, and those charges apply whether the transfer is taxable or tax-free. Before initiating any exchange, calculate whether the benefits of the new product outweigh the cost of exiting the old one. **Before executing a 1035 exchange, calculate**: - Remaining surrender charge on the old policy - Any surrender charge on the new policy (a new surrender period begins) - Whether the benefit of the exchange justifies the total surrender charge cost If your old annuity has 3 years remaining on a 5% surrender charge, transferring $200,000 costs $10,000. The new policy must offer sufficient improvement to justify that cost. **Bonus annuities**: Some insurers offer premium bonuses, 5–10% added to the transfer amount, that offset surrender charges. Examine whether bonus products are structured to recoup those bonuses through higher ongoing fees. ## 1035 Exchanges: Tax Reporting 1035 exchanges are reported on IRS Form 1099-R with distribution code "6," which signals to the IRS that no tax is owed. The distributing company reports the gross distribution amount but shows $0 in the taxable amount box. You still report the form on your tax return, but no income tax is triggered on a qualifying annuity transfer or insurance contract exchange. ### IRS Form 1099-R Reporting The distributing company issues a Form 1099-R. For a qualifying 1035 exchange: - Box 7 should show distribution code "6" (1035 exchange) - Gross distribution shown in Box 1 - Box 2a (taxable amount) should be $0 File Form 1040 reporting the exchange; the 1099-R triggers no tax. ### Partial 1035 Exchanges Section 1035 allows **partial exchanges**, transferring a portion of an annuity or life policy to a new contract. Treasury Regulation 1.1035-1 governs partials. Key rules: - Basis is allocated proportionally between the original and new contract - Withdrawals within 180 days of a partial exchange from either contract may recharacterize the exchange as a taxable distribution (the "180-day rule") - Partial exchanges must be documented carefully ## Common Mistakes to Avoid Most 1035 exchange errors fall into two categories: procedural mistakes that accidentally trigger tax on the full accumulated gain, and planning mistakes that ignore the full cost picture. The most costly error, taking a personal distribution and funding a new policy yourself, transforms a tax-free transfer into a fully taxable event. **1. Taking a distribution yourself**: This triggers taxation on all accumulated gain. Always use direct carrier-to-carrier transfer. **2. Exchanging an annuity for life insurance**: This is not a qualifying exchange and will be fully taxable. **3. Ignoring surrender charges**: Understand the full cost before proceeding. **4. Not verifying the transferred basis**: The new company must correctly track the transferred cost basis. A paperwork error can create tax complications years later. **5. Not considering the new surrender period**: You're beginning a new surrender charge period on the replacement product. Ensure your liquidity needs won't require early access. **6. Partial exchange + immediate withdrawal**: Violating the 180-day rule on partial exchanges triggers taxation. ## Authoritative Sources For deeper background and primary-source data on this topic, the following authoritative sources are useful starting points: - [National Association of Insurance Commissioners](https://content.naic.org/) - [Federal Trade Commission](https://www.ftc.gov/) ## Conclusion 1035 exchanges are one of the most powerful tax preservation tools available to annuity and life insurance holders. Used correctly, they let you upgrade products, reduce fees, improve income guarantees, or redirect coverage, all without triggering income tax on decades of accumulated gains. Here are the key takeaways: - **The exchange hierarchy matters.** Life insurance can move to life insurance, annuities, or long-term care coverage. Annuities can move to other annuities or long-term care policies. Annuities cannot become life insurance tax-free. - **Funds must flow directly carrier-to-carrier.** Taking a distribution yourself destroys the tax-free treatment, no exceptions. - **Surrender charges apply.** A tax-free transfer is not a free transfer. Calculate the full cost of exiting your existing policy before proceeding. - **Cost basis transfers with the value.** The deferred gain doesn't disappear, it moves to the new contract and will be taxed on future withdrawals. - **Partial exchanges carry a 180-day rule.** Withdrawals from either contract within 180 days of a partial 1035 exchange can trigger taxation. When executed correctly, 1035 exchanges can save tens of thousands in taxes while genuinely improving your insurance and retirement planning outcomes. Run the numbers carefully, including surrender charges and new product fees, to confirm the exchange serves your long-term goals. Ready to put this knowledge to work? Try Warren, your AI financial advisor, get personalized, conflict-free guidance at heywarren.com --- ## Related Reading **More from Warren**: - [1035 Exchange: How to Swap Insurance or Annuity Contracts Without Triggering Taxes](/blog/1035-exchange) - [Centralized Market: Definition, How It Works, and Why It Matters for Investors](/blog/centralized-market) - [Deferred Tax Assets: What They Are, How They Work, and Why They Matter](/blog/deferred-tax-assets) **Authoritative sources**: - [IRS, Tax Topics](https://www.irs.gov/taxtopics) - [IRS Publication 17, Your Federal Income Tax](https://www.irs.gov/pub/irs-pdf/p17.pdf) - [Tax Foundation, Research](https://taxfoundation.org/research/)