Tax deferral is a way to expedite the creation of personal wealth.  Rather than currently pay income tax on the earnings of a variable annuity, you can have the earnings remain in the annuity as an additional amount invested. By doing so, the portion of the earnings which would have been paid as income tax will also remain invested, resulting in potential additional earnings.  Income tax on variable annuity earnings is deferred until you withdraw the earnings.  If you are selling a business or other significant asset, you should consider an installment sale as a tool to spread the tax burden over a period of years.

Wealth Counsel Advisor Forum Estate Planning