What Is A 1035 Exchange From Life Insurance To An Annuity? 
A 1035 exchange is an IRS code section that allows a tax free transfer of cash vales from one annuity policy to another annuity policy or a life insurance policy to an annuity policy . This is also an opportunity to transfer basis in a policy as well for future use . You can not use section 1035 to transfer cash values from an annuity policy to a life insurance policy . 